Crownrise Finance Plc, a non-banking financial institution, has gotten support from the Central Bank of Nigeria over the intention to float a N1 billion bond in the Nigerian debt market, which will be available to investors this month according to report.
CBN described the move as a laudable achievement.
While congratulating the board, management and staff of the company, Tokunbo Martins, the director, Other Financial Institutions Department (OFISD), Central Bank of Nigeria, said this was the first time an institution in the finance company (FC) sub-sector is taking a pragmatic step to explore alternate source of funding to address the issue of paucity of funding, which has long been identified as one of the most important challenges facing the subsector in Nigeria.
At the stakeholders’ luncheon and introduction of the N1 billion Crownrise bond to prospective investors last week Thursday in Lagos, Martins observed that for a company that commenced operations since 1991, with the mandate to deliver quality financial services to individuals and corporate bodies in the SMEs segment of the market and has remained in operations despite all odds, “it is expected that the raising of this fund would assist the company to reposition itself in delivering on its mandates.”
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She, therefore, urged prospective investors considering fixed-income securities to invest in Corporate Bonds which some have described as the last safe investment as the yields of many variable-income securities declined after the financial crisis.
“Therefore, it is expected that the proceeds from the proposed Crownrise Bond issue by Crownrise Finance Plc would be judiciously applied by the management of the company to boost the SMEs subsector and the Nigerian economy in general, while at the same time meeting the needs and expectations of all,” she stated.
Responding, Babatunde Rufai-Lariba, the managing director/chief executive officer (MD/CEO), Crownrise Finance Plc, sought the support of investment public and other stakeholders in the firm’s quest to provide the much needed financial support to the millions of individuals and businesses pushing to explore the huge opportunities offered by the nation’s economy.
“We believe with your support, we would not only succeed, we would exceed expectation and thus reassert the important role of finance houses like Crownrise Finance Plc in economic growth of Nigeria,” he stated.
He disclosed that the company has a capital base well above the regulatory requirement, a strong corporate governance driven by a Board of Directors comprising highly experienced and successful professionals in various fields, led by Jonathan Babalola, a former Director of Other Financial Institutions Department of the Central Bank of Nigeria (CBN).
The N1 billion Crownrise Bond Offer with six-year tenor, at the rate that will be fixed at 8 percent the Monetary Policy Rate, would be floated in the middle of April with Giggo Security Limited as the issuing house and financial adviser.
Due to lack of funds, the FC subsector has not demonstrated the capacity to deliver on their complementary roles to the Deposit Money Banks and Other Financial institutions which is bridging financial gaps and meeting the financial needs of its target customers. This is the gap according to Rufai-Lariba, Crownrise seeks to fill.