Written By | Mike Omuodo
Nabil Mahfoudh, Director of Treasury at ShafDB
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Nairobi, Kenya
Shelter Afrique Development Bank (ShafDB) has launched its first sustainable bond issuance, worth FCFA 60 billion (approximately $100 million), to mobilise local-currency resources for financing affordable and sustainable housing projects in the West African Economic and Monetary Union (WAEMU) region.
The transaction is being arranged by CGF Bourse Dakar as lead arranger, with the International Finance Corporation (IFC) and Ecobank Group, through Ecobank Senegal, serving as anchor investors.
The bond is structured in two tranches: a five-year tranche carrying an interest rate of 6.10% and a seven-year tranche at 6.30%. The subscription period runs from October 7 to 30, 2026.
“Our ambition is not simply to raise capital, but to build a more diversified and resilient financing platform for housing and urban development across Africa,” said Nabil Mahfoudh, Director of Treasury at ShafDB.
“Deepening our presence in West African capital markets allows us to connect local savings with urgent development needs within the region and deploy financing in the same currency in which local developers earn their income,” he added.
A new stage in ShafDB’s transformation
The transaction forms part of ShafDB’s strategic transformation into a pan-African multilateral development bank, with the ambition of scaling up its operations and significantly increasing its impact across its 44 shareholder countries.
The transformation is supported by a strategy to diversify the institution’s funding sources, expand its access to African capital markets, mobilise additional resources from international partners and strengthen its capital base to better meet the continent’s growing financing needs.
Financing housing in local currency
The housing market in the WAEMU region faces a significant structural deficit. According to estimates cited by the World Bank Group, the region has a housing deficit of approximately 3.5 million units, with nearly 250,000 additional units needed annually to keep pace with population growth and urbanisation.
ShafDB’s bond issuance aims to channel financial resources towards affordable, sustainable and energy-efficient housing projects while aligning the currency of financing with the currencies in which the projects generate revenue.
The bank considers local-currency financing an essential tool for supporting the real estate sector. By matching the currency of financing with project revenues, the approach helps reduce borrowers’ exposure to foreign-exchange risk, which is particularly important for medium- and long-term real estate investments.
Sustainable financing framework developed with GGGI
In preparation for the issuance, ShafDB partnered with the Global Green Growth Institute (GGGI) to develop and publish its Sustainable Financing Framework.
The framework received a favourable opinion from S&P Global, strengthening the credibility and transparency of ShafDB’s approach to sustainable finance and demonstrating its alignment with the principles applicable to green and social financial instruments.
The transaction also reached a key regulatory milestone following approval by the Autorité des Marchés Financiers de l’UMOA (AMF-UMOA).
Mobilising African savings for development
The issuance also forms part of the momentum behind the New African Financial Architecture for Development (NAFAD), as outlined in the Abidjan Consensus. The initiative aims to strengthen the mobilisation of African savings and further develop the continent’s capital markets as a complement to international financing.
The broader objective is to encourage greater mobilisation of domestic and regional resources to finance Africa’s development priorities, particularly in housing, urban infrastructure and sustainable development.
With extensive experience in African capital markets, ShafDB has completed 11 bond issuances across various markets on the continent, demonstrating its ability to mobilise local-currency resources from African investors.
Its most recent issuance took place in April 2022 in Nigeria, where the institution raised NGN 46 billion, equivalent to approximately $110 million.
A new chapter for ShafDB
Through the sustainable bond issuance, ShafDB reaffirms its commitment to playing a greater role in mobilising African capital and financing the housing and urban development solutions needed across the continent.
