NCB Financial Group Limited (NCBFG) intends to go to Wall Street, New York, next week to raise its first international bond valued at US$300 million ($47.65 billion).

This was revealed in a disclosure on the Jamaica Stock Exchange (JSE) on Wednesday when NCBFG revealed that the pricing of the bond will be announced on June 11. Pricing of the bond in this instance refers to the interest rate and tenor to be offered to international investors. Citigroup is the global coordinator and sole bookrunner for the deal while NCB Capital Markets Limited and NCB Capital Markets (Cayman) Limited are the co-managers.

NCBFG had $90.72 billion (US$571.64 million) in debt at the holding company level in September 2024 with $62.99 billion ($396.89 million) due between October 2024 and September 2025. $45.99 billion (US$289.82 million) of NCBFG’s debt is denominated in US dollars.

“NCBFG will use the net proceeds to redeem part of its remaining outstanding notes and for general corporate purposes. The final rating is contingent upon the receipt of final documents conforming to information already received,” Fitch Ratings noted in its release.

Fitch Ratings assigned NCBFG an expected B+ credit rating for the upcoming senior unsecured bond. This is the same rating as its long-term issue default rating (B+) which was affirmed in March. However, S&P Global Ratings gave NCBFG a B- credit rating for the proposed senior unsecured medium-term notes. NCBFG was assigned a B- long-term rating and a B short-term credit rating by S&P Global Ratings in November 2024.

“The issuer credit rating on NCBFG is two notches below its ‘b+’ group credit profile (GCP) because of the structural subordination of the non-operating holding company (NOHC)’s creditors to obligations held by the group’s operating entities, and the NOHC’s reliance on dividend distributions from its subsidiaries to meet its obligations,” the S&P Global Ratings release stated.

National Commercial Bank Jamaica Limited (NCBJ), NCBFG’s wholly owned subsidiary with 53 per cent of the group’s consolidated assets, is rated by Fitch Ratings and S&P Global Ratings at BB– which is the same rating as the Government of Jamaica. Thus, NCBFG is rated one rung below NCBJ by Fitch for the upcoming offer, but three rungs below NCBJ by S&P Global. A credit rating of B- is one rung above CCC+ (S&P Global) which is deemed substantial risk.

Rating agencies such as Moody’s Ratings, Fitch Ratings and S&P Global Ratings assign credit ratings to companies/corporates and sovereign states/territories when they are seeking to borrow money. These credit ratings indicate to potential investors or lenders the likelihood that a firm will be able to repay the money that it borrows from investors. A credit rating of Aaa and AAA is the highest credit rating assigned by all the rating agencies and allows for firms/countries to borrow money at extremely low rates. Credit ratings between Aaa and AAA to Baa3 and BBB- are considered investment grade credit ratings which means that investors can feel assured that the borrower will have a decent capacity to repay investors. Credit ratings of Ba1 and BB+ and below are considered non-investment grade credit ratings and can result in borrowers paying a higher interest rate to investors to justify the higher risk they take by lending to these borrowers.

NCBFG recently refinanced US$19.5 million worth of domestic debt in April with rates ranging from 8.00 to 8.50 per cent. Telecommunications Services of Trinidad and Tobago Limited, a joint venture between the Trinidad Government and Cable & Wireless (West Indies) Limited, issued a US$300 million bond with an 8.875 per cent interest rate in October 2019 when it had a BB- rating. Also, some funds like the Morgan Stanley Emerging Markets Debt Fund only invest in issuances with face values of at least US$500 million. Thus, investors will be keenly watching the pricing date to see what rate will be offered to the market.

As part of NCBFG’s plan to raise this debt, it had to provide an offering memorandum to the international market which contains a lot more detailed disclosures than their quarterly and annual reports. That document revealed that although NCBFG’s proposed sale of Clarien Group Limited (CGL) to Cornerstone Financial Holdings Limited had expired on May 8, it will now have to pay about US$20 million to acquire the 17.92 per cent stake of CGL held by Portland Private Equity (PPE). NCBFG paid $4.15 billion (US$33.04 million) in December 2017 for its 50.10 per cent stake in Clarien with PPE paying an estimated $1.49 billion (US$11.82 million) for its 17.92 per cent stake. Clarien Group paid its first post-acquisition dividend of US$3.75 million in mid-2024.

“Following the expiration of the sale and purchase agreement, in June 2025, NCBFG was advised that a previously agreed exit provision for a minority shareholder group in CGL (private equity funds in which Michael A Lee-Chin and Robert Almeida, the chairman and group chief executive officer of NCBFG, respectively, each holds an interest) will be triggered by that minority shareholder group, pursuant to which NCBFG will acquire an additional 17.92 per cent stake in CGL from the minority shareholder group at the fair market value of CGL’s shares as will be determined by an expert or another mutually agreed method in accordance with the applicable shareholders’ agreement,” the memorandum stated.

NCBJ also didn’t complete the sale of NCB (Cayman) Limited to Berkley Financial Holdings Limited as that deal was terminated in January 2025. NCBFG CEO Robert Almeida and NCBFG chairman Michael Lee-Chin have been on a pursuit to lower debt across the group.

Based on recommendations made by the Bank of Jamaica, NCBFG will be adding a new independent director by September 2025 to achieve a two-thirds independence composition on the board. NCBFG appointed Arvinder Bharath as a director of NCBFG on January 2 and elected a director on February 13. NCBFG’s other independent directors include Gary Brown, Thalia Lyn, Sanya Goffe and Howard Shearer. Almeida and NCBJ CEO Bruce Bowen are executive directors while Lee-Chin is the non-executive chairman of the eight-person board.