The International Finance Corporation (IFC), the private sector arm of the World Bank, expects to raise $22 million (about Rwf15 billion) when it issues its local currency-based bond on Rwanda Stock Exchange tomorrow. 

Celestin Rwabukumba, the chief executive of Rwanda Stock Exchange, said funds raised from the bond issue are expected to continue financing developmental projects in Rwanda.  

The move is expected to greatly boost government’s efforts to attract activity on the local exchange through diversified products and instruments. 

There are currently three government bonds on the stock exchange and an eight-year corporate bond worth Rwf10 billion issued in 2010 by I&M Bank. 

Sector analysts say the move by IFC is an effort to expand its Africa debt programme. 

Bank of Kigali and Standard Bank Group Securities firms are handling the bond sale for IFC. 

"We have so far received a considerable interest from investors, mainly domestic institutions. We expect the bond to be fully or oversubscribed by Thursday (tomorrow),” Lawson Naibo, the chief operations officer of Bank of Kigali, told The New Times yesterday. 

He added that the bond was made available to institutional, retail and individual investors on Monday. 

Brokers have recommended it as an opportunity for local investors to diversify their portfolios. 

Naibo said they were doing the book building process, after which a suitable interest rate will have been determined, adding that issuing the bonds in Rwandan franc would attract more local investors as well as foreigners. 

The World Bank debuted its pan-Africa domestic medium-term note programme with the sale of 150 million Zambian kwacha ($24m) of Zambezi notes in September last year in an offer that was 4.8 times oversubscribed.  

The Bank has also been in talks with the governments of Botswana, Kenya, Namibia, South Africa, Nigeria, Ghana and Uganda about local-currency issuances, according to reports. 

The lender had in February last year raised Naira 12 billion ($74 million) in Nigeria, selling its Naira bonds. Since then, it has received approval to set up a programme that will allow IFC to issue as much as $1 billion in debt in Nigeria. 

The IFC has also set up a domestic medium-term note programme in Ghana.

In February, the Rwandan government issued a Rwf12.5 billion treasury bond that was oversubscribed by 140 per cent, a record demand for the first sale of debt in Rwanda franc since 2011. 

The government is expected to issue other bonds this month, in August and November. 

IFC’s total investment portfolio in Rwanda is estimated at $42m as of June 30, 2013, and is spread across different sectors of the economy.

The largest share of investment is in construction and real estate at 31 per cent, followed by finance and insurance at 22 per cent. 

The other sectors include accommodation and tourism, agriculture and forestry.