Stanbic IBTC’s Kobby Bentsi-Enchill speaks on Dangote Cement’s FMDQ listing

Dangote Cement, one of Nigeria's foremost companies, recently made headlines with its 50 billion naira Commercial Paper listing on the FMDQ Securities Exchange. This significant move was facilitated by Stanbic IBTC Capital, with Kobby Bentsi-Enchill, Executive Director and Head of Debt Capital Markets at Stanbic IBTC Capital, shedding light on the landmark listing during a CNBC Africa interview. The listing marked the establishment of a program by Dangote Cement, signaling its intention to be a frequent issuer in the market. The program size of 150 billion allows the company to access funding as needed, reflecting a strategic approach to capital management. The initial issuance of 50 billion set a record as the largest Commercial Paper issuance in recent times, comprising two series with competitive pricing. Bentsi-Enchill highlighted the importance of diversification in funding sources for corporates, encouraging more blue-chip companies to explore the commercial paper market. The transition in Nigeria's investment landscape was also a focal point of discussion, with a notable shift towards a more diverse investor base. While banks traditionally dominated investments in Commercial Papers, there has been a noticeable increase in foreign and local institutional investors participating in such offerings. This evolution provides companies with a wider range of funding options, including securities that are tradable, enhancing liquidity in the market. Foreign investors' interest in Nigeria's local currency bonds and commercial papers reflects a growing confidence in the country's economic outlook, underscoring its attractiveness as an investment destination. Bentsi-Enchill emphasized the significance of the increased investor interest from both domestic and foreign entities, noting that the diversification of funding sources benefits treasurers and finance directors by expanding financing avenues. The tradeability of securities allows investors to manage their portfolios more effectively and react to market conditions, contributing to a more dynamic and robust financial ecosystem. As more companies follow Dangote Cement's lead in tapping into the commercial paper market, this pioneering listing is poised to inspire greater participation and innovation in Nigeria's capital market landscape.