Standard Bank, the biggest bank in Africa by assets, has become the first African bank to issue Flac notes. The bank acted as Issuer and Arranger to successfully execute a R2bn Flac note issuance structured across four tranches.
Flac notes are new regulatory instruments introduced by the South African Reserve Bank to enhance the financial strength of the South African banking system. This follows similar developments in European markets over the last 10 years. All systemically important banks in South Africa will be required to issue Flac notes.
The inaugural Flac bond auction attracted over R10 billion in bids from over 30 institutional investors, a significant vote of confidence by local investors in the strength of Standard Bank and the broader banking market.
“This important transaction and transition towards both Flac and ZARONIA-linked instruments is the culmination of many years of legal and regulatory work, as well as extensive institutional investor engagement,” says, Paul Burgoyne, Head of Treasury & Money Market at Standard Bank.
The Flac auction, held earlier this year, also underscored Standard Bank’s leadership in the market’s adoption of the new ZARONIA interest rate benchmark. In addition to being the first issuance of Flac notes, this auction was the first time a public note offering was conducted on a ZARONIA only basis. Standard Bank was the first bank to issue ZARONIA linked bonds in May 2025.
“We are proud to have been able to lead the market in both Flac and ZARONIA, and this transaction marks another important milestone in strengthening the South African financial system,” adds Burgoyne.
“By leading this shift and shaping the evolution of the Debt Capital Market, Standard Bank is actively driving structural innovation within South Africa’s financial market and setting the foundation for a more resilient funding ecosystem,” says Carl Wisener, Head of Debt Capital Markets South Africa.
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