UPDATE 2-Nigeria's First Bank seeks to raise $3.4 bln bond

* Would be country's 1st corporate bond in 3 years

* To hold meeting Aug. 20 to vote on issue

* Funds to be used for infrastructure projects

(Adds analyst comment, paragraph 3)

By Chijioke Ohuocha

LAGOS, July 27 (Reuters) - First Bank FBNP.LG said on Monday it wants to raise a 500 billion naira ($3.4 billion) bond in what would be Nigeria's first corporate bond in three years.

Nigeria's oldest bank said it would hold an extraordinary shareholders' meeting to vote on the issue on Aug. 20 in the capital, Abuja.

"Right now there is a yearning for corporate bonds. Given that this is issued by an institution that is reputable, investors would go for it," said Henry Ogbuaku, head of research at Express Discount Asset Management.

Industry sources told Reuters on Thursday First Bank had received regulatory approval from Nigeria's central bank and the Securities and Exchange Commission. It is also seeking approval from the Nigerian Stock Exchange to trade the bond at the bourse. [ID:nLN340093]

The bank aims to use the bond issue to raise funds for infrastructure projects such as the Lagos-Ibadan highway, one source said.

Nigerian companies have not ventured into the corporate bond market for several years because of the high cost of issuing debt and tax concerns. Access Bank ACCE.LG was the last institution with its 13.5 billion naira bond in October 2006.

New central bank Governor Lamido Sanusi said earlier this month he wants more companies to raise funds through the bond market.

Sanusi said the regulator would seek to reduce the cost of corporate bond issues and work with tax authorities to have a tax-free yield curve. [ID:nLD726472] (Writing by Randy Fabi; editing by Simon Jessop and David Cowell)