Baker McKenzie advised Bank One Limited ("Bank One") as arranger and swap provider in connection with a USD 100-million USD/local currency swap transaction with a central bank in sub-Saharan Africa (with up to USD 150-million greenshoe option) and a participation agreement with multiple lenders.
Under the terms of the transaction documents, the swap is collateralised by government bonds held with a local custodian bank, which are returned to the central bank upon termination of the swap. The documents are structured for potential repeat transactions on a syndicated basis and as such effectively create a USD/local currency swap programme, which the central bank can use to meet its USD funding needs on an ongoing basis.
The Baker McKenzie team was led by Johannesburg Partner Lodewyk Meyer and supported by London Senior Associate James Tanner and Johannesburg Associate Lara Stockley. The Baker McKenzie team has assisted Bank One with similar African transactions over the last several years.
“We are delighted to have supported Bank One on another significant transaction in the African financial market. Such transactions could lead the way for other central banks in Africa to adopt similar measures to deal with the impact of the pandemic on financial institutions,” said Lodewyk Meyer, Partner and Head of the Banking & Finance Practice at Baker McKenzie in Johannesburg.
Headquartered in Port Louis, Mauritius, Bank One is a universal bank offering consumer, corporate, private and international banking products to its clients. Its shareholders CIEL Finance Limited and I&M Holdings PLC own sizeable banking operations in Madagascar, Kenya, Tanzania and Rwanda, giving Bank One a tangible presence in Africa. Bank One has a niche focus on serving sub-Saharan African financial institutions and central banks.