African Bank buys back bonds

African Bank opens an offer to repurchase up to $500 million worth of bonds from its foreign currency-denominated bond holders.

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Johannesburg - Bailed-out lender African Bank on Friday opened an offer to repurchase up to $500 million worth of bonds from its foreign currency-denominated bond holders, the South African bank said.

African Bank, a lender which was rescued and recapitalised by the central bank after its parent African Bank Investments collapsed in 2014, said its aim was to reduce its interest expense with the tender offer, which will be open until July 13.

It crumbled under a mountain of bad debt.

In April the bank was split into a “good” unit to attract new clients and Residual Debt Services to rake in old debts.

Read also: Losses at failed African Bank plunge

In December, it posted a narrower full-year loss of R7.2 billion, down 22 percent from2014.

The bank was hobbled by bad loans as its core market of low-income borrowers struggled to repay debts amid high unemployment and rising inflation.

REUTERS