I&M Bank bond raises 161.38bn/- in record oversubscription

DAR ES SALAAM: THE I&M Bank Tanzania’s Hatua Bond has raised 161.38bn/-, representing an oversubscription of 806.92 per cent against the targeted 20bn/-, setting a new record in Tanzania’s corporate bond market.

The bond’s performance surpassed the entire 100bn/- Medium-Term Note (MTN) programme that was scheduled for issuance in four phases between 2026 and 2029.

Capital Markets and Securities Authority (CMSA) Chief Executive Officer Nicodemus Mkama said today in Dar es Salaam that the achievement made Hatua Bond the most oversubscribed corporate bond ever issued in the country.

He said the bond had broken the record previously held by iTrust Finance Limited’s iTrust Bond, which raised 114.12bn/- against its target, representing an oversubscription of 760.78 per cent, before being listed on the Dar es Salaam Stock Exchange (DSE) on July 8 this year.

Mr Mkama attributed the strong performance to investor confidence, supportive government policies and regulatory measures aimed at expanding participation in the capital markets.

He said 95.48 per cent of Hatua Bond investors were individual investors, while institutional investors accounted for 4.52 per cent. Domestic investors represented 95.73 per cent of participation, compared with 4.27 per cent from foreign investors.

According to him, the high participation of local individual investors was important in promoting financial inclusion and improving liquidity in the stock market.

He said incentives included the removal of withholding tax on interest earned from corporate and institutional bonds, as well as CMSA’s approval to reduce the minimum investment in Hatua Bond from 1m/- to 500,000/-.

Investors were also allowed to receive interest payments quarterly instead of every six months, making the investment more attractive by providing more frequent income.

Mr Mkama said listing Hatua Bond on the DSE increased the value of investments in corporate and institutional bonds by 4.48 per cent, from 2.23tri/- to 2.33tri/-.

He added that listing provided investors with an opportunity to sell their bonds when they needed cash, while enabling new investors to participate and helping establish market prices.

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Mr Mkama urged public and private sector companies to use capital markets to raise funds for business expansion and development projects, saying the initiative supported the objectives of Tanzania’s Development Vision 2050.

He said CMSA would continue promoting innovative investment products to widen opportunities for domestic and international investors.