SA’s debt capital market (DCM) was a hive of activity in the second quarter of the year with total issuances nearly R13bn more than in the first quarter, with banks, mining companies and property groups leading the way.
According to data from Futuregrowth, one of SA’s leading intuitional bond investors, total issuances in the quarter under review came in at R39.5bn, a big leap from the R26.6bn reported in the first quarter of the year.
Futuregrowth said banks, corporates and real estate investment trusts (Reits) led the activity with auctions in the period well supported.
“Banks and financial services led this growth, increasing their issuance from R14.1bn to R21.1bn. Corporate issuances also surged, climbing from R6.7bn to R16.1bn. Meanwhile, municipalities continued their absence from the DCM,” Futuregrowth said.
“Market volatility following the ‘Liberation Day’ tariff announcements led issuers to favour private placements over market auctions.”
The data shows all SA’s five big lenders — Absa, FirstRand, Nedbank, Standard Bank and Investec Bank — issued senior paper totalling R7.9bn during the second quarter, with auctions oversubscribed.
Financial services groups Discovery and Old Mutual raised R1.5bn and R1.2bn, respectively. Futuregrowth said corporate issuance was led by the mining and Reit sectors, which raised R5.7bn and R6bn, respectively.
The auto sector also returned to the market via a issuance by Daimler Truck Southern Africa, which raised R1.48bn through public auction that attracted 21 bidders.
“Northam Platinum privately placed R5.7bn across the three, four and five-year notes. The three and five-year tranches each amounted to R2.5bn, supporting a staggered maturity profile. This follows the company’s May 2023 issuance, when it raised R2.2bn across three and five-year notes,” the asset manager said.
“The MTN Group continued to be the most prominent mobile network operator in the DCM. Its public auction was well supported, receiving R3.6bn in bids, with R1.7bn allocated,” it said.
“Growthpoint, Emira, Fortress, and Resilient Reit returned to the market to raise term funding.”
Growthpoint, SA’s largest commercial property owner, raised R1.3bn via private placement, while Equites raised R1.2bn via a one year privately placed note.
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