Nigeria raises N219bn in FGN bonds at higher yield – DMO

FG releases details of Paris club payment to states
United Bank for Africa

Debt Management Office (DMO) on behalf of the Federal Government of Nigeria has raised a total sum of N219.58 billion in local currency denominated bonds with higher yields, at an auction on Wednesday, the Debt Manager disclosed on Thursday.

The DMO said it targeted N40 billion through offer for her monthly auction of FGN bonds, which will be matured in February 2020, and N50, 000,000 worth of FG Bond, an equivalent of 12.50 percent to be matured January.

The debt office said it sold 40 billion naira of 2021 paper at 15.08 percent at Wednesday’s auction, compared with 14.50 percent at the previous auction last month.

The DMO explained that it also sold N30 billion of 2026 debt at 15.28 percent, against 14.90 percent, and N40 billion of the 2036 debt at 15.53 percent against 14.98 per cent.

Also, it sold N109.29 billion more than the initially advertised amount of N40 billion for the 2021 paper at the auction, with a total subscription at the auction stood at N210.29 billion, lower than the N231.76 billion demanded at the last sale.

Nigeria is in the middle of its worst crisis in decades as a slump in oil revenues hammers public finances and the naira. Gross domestic product shrank in the first quarter and the central bank governor has said a recession is likely.

Meanwhile, the second largest economy has earlier disclosed that it would borrow about N900 billion locally to finance part of the N2.2 trillion deficit in its 2016 budget, to plug shortfalls.

It is worthy to note that the federal government issues local bonds as part of measures to finance the government budget deficit and also help to manage liquidity in the banking system.

However, the nation’s currency, Naira on Thursday depreciated against the dollar in a single interbank market trade of $1 million, Thomson Reuters data has showed.


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The Naira traded at an all-time low of 365.25 to the dollar on Thursday, where interbank trading started two hours after the market opened and offered the currency sharply lower against the dollar.