African Bank Investments Limited: R150m bond to be repaid on maturity

African Bank Investments Limited (Abil) would repay investors when a R150 million bond matured today, it said yesterday, after record losses fanned speculation that South Africa’s largest unsecured lender might need to raise funds. Since issuing the one-year floating-rate note at the three-month Johannesburg interbank agreed rate plus 90 basis points, Abil has reported a record first-half loss following write-offs at its furniture unit and increased bad debts. In May Moody’s Investors Service cut the lender’s foreign rating to Ba1, one step below investment grade. “Consistent with our practice of settling bonds upon maturity, this bond will be no exception and we have thus planned appropriate cash reserves to do so,” chief financial officer Nithia Nalliah said. While Abil sold R5.5 billion of stock in December last year to bolster capital, that has been partly eroded by the first-half loss. Abil shares fell 1.18 percent to R6.72 yesterday. – Bloomberg