The Federal Government has raised N2.13 trillion through the issuance of its domestic securities between last month and now.
Out of the sum, N1 trillion has already been deducted by the government to finance this year’s budget deficit.
Retail investors are said to have committed N45.135 billion to the Federal Government of Nigeria (FGN ) Saving Bonds alone last year.
The other security instruments are treasury bills and FGN bonds.
The Debt Management Office (DMO), in a statement, explained yesterday that the N1 trillion deduction represents “14.2 percent of the total requirement of N7.043 trillion deficit for the year.”
The balance of N1.129 trillion is to be used to refinance maturing obligations.
The DMO added that it was “maximising the opportunity provided by the strong investor demand to raise funds to facilitate early implementation of the budget”’
It assured that it would always be guided by the law and as such, will “not exceed the legally approved New Borrowing in the Appropriation Act.”
DMO’s Director-General, Patience Oniha, made this disclosure at an engagement between her office and Distribution Agents and Market Stakeholders for the Final Demonstration of the FGN Securities Subscription Portal.
“Since its introduction in March 2017, the FGN Savings Bond has performed relatively well. Total Subscription from 2017 to December 2022 was N45.135 billion with investors coming from the six (6) geo-political zones and the Federal Capital Territory, “Oniha stated.
She added that the DMO would work with the Central Securities Clearing System (CSCS) to launch a portal next month to enable more Nigerians to subscribe to the bonds and securities.
The DMO boss added: “The DMO believes that the product has more potential than what has been achieved so far and has for now, identified two ways to achieve much higher volumes and numbers of investors.
“In 2022 we embarked on investor sensitization programmes across a number of cities in Nigeria, this strategy proved successful as total subscription almost doubled from N8.396 billion in 2021 to N16.589 billion in 2022. Given this outcome, the DMO plans more of such sensitisation, as well as wider publicity.”
Managing Director/Chief Executive Officer of Central Securities Clearing System (CSCS) Haruna Jalo-Waziri, challenged brokerage firms to set up Apps for their organisations to attract young investors to the capital market.
A presentation on the FGN Security Bonds journey so far indicated that the subscriber base had hit 31, 675 as of the end of last year.
An analysis of the developments in the sub-sector also showed a higher appetite for the three-year-old bond, as against the two-year tenured bond.