DOLLA Financial Services Limited has launched a $1-billion secured bond offering, with an option to upsize the offer to $1.5 billion, as it plans on expanding its growing loan portfolio.

The microcredit firm has been aggressively expanding its consolidated loan portfolio over the last three years which has moved from $1.05 billion in June 2023 to $4.46 billion in June 2025. Dolla has fuelled this expansion with a combination of equity capital from its June 2022 initial public offering (IPO) and debt from the capital markets.

“In 2024 alone, Dolla disbursed $2.4 billion in loans — solidifying our position as a trusted partner in financial empowerment. This achievement validates the strength of our products and our ability to deliver meaningful financing solutions that support entrepreneurship, growth, and economic development,” said Chairman Walter Scott in the prospectus.

The company previously raised a $1.17-billion secured bond in September 2023 which was listed on the JSE Private Market. Tranche I of that bond matured on October 3 and was delisted from the Private Market with a face value of $570.12 million and a 10.50 per cent interest rate.

Dolla intends to refinance this tranche and expand its loan portfolio with this public bond offering which should be listed on the JSE Bond Market.

Tranche I of this public bond offering will provide investors with an 11 per cent interest rate for three years while tranche II will provide investors with a 12 per cent interest rate for five years. Each tranche has a size of $500 million and can be upsized in either or both tranches to bring the total debt raise to $1.5 billion. However, the company reserves the right to decline any sum below $400 million.

The public bond will be secured by a debenture which will create a fixed and floating charge over all of the company’s assets. Dolla will be subject to financial covenants, such as a maximum leverage ratio of no more than 4.50 times, a minimum interest coverage ratio of no less than 1.50 times and a maximum net debt to equity ratio of no more than 4.0 times. After 12 months have elapsed, Dolla can voluntarily prepay or redeem any tranche without premium or penalty on interest. That payment date would be subject to giving 30 days notice.

Dolla’s core business involves the provision of short-term micro and small loans to businesses and employed persons. This business lends money via its 10 loan products spread across its eleven branches spread across Jamaica. Its subsidiary Ultra Financier provides secured short-term loans to high-net-worth individuals but has since pushed a rebrand as a private credit player. Dolla Guyana Inc began operations in September 2021 but is currently winding down with the process expected to be completed in the current quarter.

Dolla’s consolidated interest income from loans grew by 34 per cent from $742.36 million to $991.93 million over the six months period to June 30. Despite a 64 per cent increase in interest expense to $199.74 million from higher borrowings, net interest income increased 28 per cent to $794.09 million.

However, Dolla’s provision for credit losses jumped from $8.29 million to $113.82 million due to write-offs and increased provisioning due to loans impacted by impaired loan security documentation. The impaired loans were valued at $170 million, but Dolla’s management team has launched a comprehensive investigation, implemented remedial activities and continues to pursue all avenues to recover amounts lost.

Business loans make up 93 per cent of the company’s loan portfolio with 83 per cent of overall loans being secured by some asset or guarantee. The non-performing loan portfolio was 12.8 per cent while expected credit losses were 3.5 per cent as of June 30.

Dolla’s operating expenses also grew 44 per cent to $446.44 million due to increased employee compensation costs from inflation and intensified marketing efforts to grow the loan book. This left Dolla’s profit before tax down 17 per cent to $251.76 million with net profit declining 13 per cent from $284.05 million to $247.86 million. Dolla, the standalone company, continues to benefit from a 100 per cent income tax remission until June 2027.

Dolla’s asset base has increased three per cent over the six months period to $4.73 billion with loans at $4.46 billion and cash at $47.49 million. Shareholder’s equity is up 20 per cent to $1.35 billion.

Dolla’s total liabilities were down two per cent to $3.38 billion with loans payable at $3.15 billion. Tranche II of its 2022 bond maturing in October 2027 valued at $600.70 million while its 2024 bond is maturing in September 2028 with a face value of $1.65 billion.

Dolla’s largest shareholder is Widebase Limited which owns a 21 per cent stake. Mayberry Jamaican Equities Limited (MJE) also owns 11.56 per cent of Dolla. Widebase and MJE are subsidiaries of Mayberry Group Limited (MGL). Supreme Ventures Limited (SVL) also owns 15 per cent of Dolla. Gary Peart is the chief executive officer (CEO) of MGL and executive chairman of SVL.

If Dolla can list its bond on the JSE Bond Market, it would be the first Junior Market company to list on that market. There are currently 13 securities issued by four Main Market companies on the JSE Bond Market. MJE recently completed a secured bond offering where it raised more than $1 billion and should list its two tranches in the future.

There are currently three securities listed on the JSE’s USD Bond Market with Express Catering Limited being the only Junior Market company in that space.

Dolla’s bond offer will open on October 23 and closes on November 13. Investors can approach Mayberry Investments Limited to apply on their digital portal or use selling agents portals once they are announced. The minimum amount to subscribe to either tranche is $20,000 with increments of $10,000. Interest will be paid quarterly (March 30, June 30, September 30, December 30) with the first payment scheduled for December 30, 2025. The expenses associated with the offer should cost $54.10 million.