Centum Investment has restructured a Sh3.1 billion dual-currency loan from Standard Bank of South Africa into a fully shilling-denominated facility, reducing the risk of future exchange rate fluctuations should the Kenyan shilling weaken against the dollar.
The loan, managed through Centum’s subsidiary, Vipingo Development Plc, initially included a portion of $5.9 million (Sh762 million), with the rest in Kenyan shillings. The dollar segment was priced at three-month Libor plus 5.75%, while the shilling part was pegged to the Standard Bank Prime Rate of 9.91% plus 4.5%.
Centum’s latest annual report reveals that by March 2024, the dollar component had been converted to shillings, priced at the prevailing 182-day Treasury bill rate plus 3.5%. The facility is secured by Vipingo’s land and guaranteed by Centum Investment Company Plc.
Additionally, Centum closed a separate dollar facility with Stanbic Bank Kenya. By March 2024, the outstanding amount on overdrafts and term loans with Stanbic was Sh1.9 billion, down from Sh2.2 billion, with the dollar exposure of $4 million eliminated. These facilities are now priced at the 182-day Treasury Bill rate plus 2.7%, secured by the company’s securities portfolio.
This loan restructuring coincides with the global phase-out of Libor, with most loans transitioning to new benchmark rates such as the US Treasury’s secured overnight financing rate and other regional equivalents.
As of March 2024, Centum’s total dollar-denominated debt stood at Sh8.03 billion, up from Sh7.3 billion the previous year.
About Centum Investment
Centum Investment Company Plc is one of East Africa’s leading investment companies, listed on the Nairobi Securities Exchange (NSE) and the Uganda Securities Exchange (USE). Established in 1967, Centum focuses on creating wealth for its shareholders by investing in high-growth sectors such as real estate, financial services, private equity, and energy.
It has played a pivotal role in developing transformative projects across Kenya, including Two Rivers Development and Vipingo Development.
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