The Nation Newspaper

Tag: DMO

  • DMO to redeem N198b T-Bills

    DMO to redeem N198b T-Bills

    The Debt Management Office (DMO) is set to repay in full at maturity, the N198.032 billion Nigerian Treasury Bills (NTBs) maturing this month.

    Details provided yesterday by the debt office showed that N131.415 billion and N66.617 billion of NTBs will mature on December 14 and 21. Before now, the practice was to rollover NTBs at maturity.

    In a statement, it said redemption overtime, will help reduce the refinancing risk associated with short-term borrowings through NTBs with tenors of 91, 182 and 365 days. As at September 30, NTBs accounted for 30.23 per cent of the Federal Government of Nigeria’s (FGN’s) domestic debt of N12.5 trillion compared to the DMO’s target of a maximum of 25 per cent.

    Providing further details, the DMO stated that the NTBs will be redeemed primarily using proceeds of the $500 million raised through a Eurobond Issuance by Nigeria,last month. Nigeria had issued a dual-tranche $3 billion Eurobond in November out of which $2.5 billion is to part-finance the deficit in 2017 Appropriation Act.The balance of $500 million is for the refinancing of domestic debts.

    By redeeming the N198.032 billion NTBs, the government is not only implementing its debt management strategy but providing liquidity to the financial system to enable the private sector access credit from banks and issue securities in the domestic market to raise funds.

    The DMO expects operators in the market to use this opportunity to develop the other segments of the debt capital market like the corporate bonds.

    The DMO added that this strategy of enabling the private sector to access funds and possibly at a lower cost than was hitherto possible is consistent with the government’s policy of a private-sector led growth.

    It will be recalled that the government had announced plans to refinance some maturing domestic debt with external borrowing as part of its overall debt management strategy of reducing debt service costs.

    Other objectives of this strategy are to free up space in the domestic market for other borrowers and achieve a more sustainable debt portfolio mix of 60 per cent domestic and 40 per cent external.

     

  • What Nigeria stands to gain from $3b Eurobond, by DMO chief

    •DG says offer oversubscribed by 400 per cent

    The Federal Government plans to use the proceeds of the $3 billion Eurobond Offer it issued in two tranches of $1.5 billion for 15 years and $1.5 billion for 30 years to refinane domestic debts.  The offer, issued through the Debt Management Office (DMO), was oversubscribed by 400 per cent. In this report by COLLINS NWEZE, the DMO Director-General, Ms. Patience Oniha, explains the government’s debt management strategy and the envisaged impact of the offer on the economy. THERE were high expectations within the International Capital Market (ICM) when the Federal Government announced plans to raise $5.5 billion with the backing of the Debt Management Office (DMO).

    In line with the government’s debt management strategy, the $5.5 billion has two components. The first – $2.5 billion to part-finance the 2017 Appropriation Act deficit and $3 billion Eurobond to be borrowed from external sources and proceeds targeted at repaying maturing domestic debt obligations.

    So, when the $3 billion Eurobond offer eventually came and was oversubscribed by 400 per cent, the DMO Director-General, Ms. Patience Oniha attributed the success to foreign investors’ appetite for Federal Government’s instruments. The DMO chief, who oversaw the successful issuance of the country’s first Sovereign Sukuk of N100 billion, also gave further details.

    On plans to raise $5.5 billion from the international financial markets, Ms. Oniha explained the federal government’s strategy.

    She said: “The DMO had for several years raised funds for the government largely in the domestic market through FGN Bonds and Nigerian Treasury Bills, and to a limited extent, from external sources mainly the multilaterals.

    “While this had a beneficial effect of developing the domestic debt capital market, the government became the dominant issuer to the extent that it has been regularly accused of crowding out the private sector.

    “The outcome was obviously not intentional, but to remedy the situation. The DMO deemed it fit to shift some of the borrowing activities to the international financial markets. This is also in line with its debt management strategy of achieving a portfolio mix of 60 per cent domestic and 40 per cent external.

    “Through the strategy, the share of domestic debt has been brought down from over 85 per cent to 77 per cent as at September this year.”

    Giving insights into the components the DMO director0general said: “The $5.5 billion is made up of two components, the first of which is $2.5 billion to part-finance the deficit in the 2017 Appropriation Act. The 2017 Appropriation Act included new borrowings of N1.254 trillion from the domestic market and N1.068 trillion equivalent of about $3 billion from external sources.

    “As at October 2017, only $300 million in the form of a Diaspora Bond had been raised leaving an unfunded balance of $3.2 billion. The other component of the $5.5 billion external capital raising is the $3 billion whose proceeds are to be used to repay some maturing domestic debt obligations.”

    Speaking on the benefits expected from borrowings, she said: “The DMO’s role in financing budget deficits  as provided in Annual Appropriation Acts, are to support  budget implementation and the attainment of the government’s economic targets. The $2.5 billion is specifically targeted at fulfilling the DMO’s mandate in this regard.

    “On the $3 billion for refinancing domestic debt, there are several benefits for the action. Firstly, it will reduce the crowding out effect that I earlier referred to thereby creating more space for other borrowers in the domestic market.

    “It also has the potential to bring about a reduction in lending rates which would make the cost of production of goods and services by the private sector cheaper and more price-competitive.

    “Another major benefit of raising external capital is a lower cost of borrowing to government and a moderation in debt service costs. As you know, United States (U.S.) dollar interest rates are much lower than naira interest rates. The $1.5 billion 10-year and $1.5 billion 30-year Eurobonds were issued at coupons of 6.5 per cent and 7.625 per cent per annum respectively.

    “These coupons are certainly much lower than the 15 per cent to 17 per cent that the government borrows at in the domestic market for shorter tenured funds. There is also the fact that the $3 billion is a direct accretion to Nigeria’s external reserves which are extremely useful for managing the naira exchange rate.”

    Ms. Oniha explained what accounted for the over-subscription of the Eurobonds by over $11 billion (about 400 per cent of the $3 billion that the government took) and her agency accepted less than the $5.5 billion approved by the National Assembly.

    Her words: “The demand of over $11 billion from international investors is a demonstration of their confidence in the policies and reform initiatives of President Muhammadu Buhari as well as the economic outlook of Nigeria.

    “Like those investors, we ourselves can attest to the economic improvements in Nigeria as demonstrated by higher external reserves, stable exchange rate, Gross Domestic Product (GDP) growth of 1.44 per cent in the third quarter of 2017 and improvement in the Ease of Doing Business.

    “Our intention was not to raise the $5.5 billion at once. Our first priority was to raise the $2.5 billion required for the 2017 budget while the $3 billion required for refinancing domestic debt will be in a phased manner.

    “Also, from a technical perspective, we still wanted to moderate the cost even in the International Capital Market by managing the supply of Nigeria’s Eurobonds in the market.”

    On the significance of the 30-year Eurobond being issued for the first time in the country, she said: “It is remarkable that international investors were willing to take a long term risk on Nigeria by buying the 30-year Eurobond. This feat is even more remarkable when we consider that South Africa which has a superior sovereign rating of BB- compared to Nigeria’s B+/B rating is the only sub-Saharan country that has issued a 30-year bond in the International Capital Market.

    “The other outstanding aspect of the 30-year Eurobond is its Pricing at 7.625 per cent which is lower than the coupon of 7.875 per cent on the $1.5 billion 15-year Eurobond issued earlier in the year.

    “In terms of its specific benefits to Nigeria, it provides the appropriate funds for financing infrastructure which is typically long term while also reducing the refinancing risk of the debt stock.

    “It will also serve as a benchmark for local and foreign institutions which may need to raise long term dollar funds to invest in Nigeria under various Private Public Partnership (PPP) arrangements for infrastructure as well as privatisation.”

    She said the fresh borrowings from the International Capital Market will not anyway worsen the country’s debt burden.

    The DMO chief said: “I want to re-assure Nigerians that the government’s borrowings are pre-approved by the executive and legislative arms of government and are used to finance various activities of the government as appropriated.

    “These layers of approvals ensure that the borrowings are both necessary and scrutinised before the DMO embarks on actual borrowing.    The increasing focus by the current administration of using borrowed funds for infrastructural development is a step in the right direction.

    “As borrowing is deployed to infrastructure to promote economic growth, the benefits of job creation and increased production among benefits are good for all Nigerians.

    “Besides, the debate on debt burden should therefore shift to actively supporting the government to increase revenue to levels comparable to the sub-Saharan average of 17 per cent of GDP. The other part of the argument about debt becoming a burden is the issue of Nigeria’s revenue base which at six per cent of GDP is not only low but well below that of peer countries.

    “Interestingly, government’s revenue is now being given proper attention. The measures to increase revenues are already yielding some results, and as this trajectory continues, the need for borrowing is expected to reduce while debt service will become an increasingly smaller portion of revenue.”

     

  • DMO takes savings bond to grassroots

    DMO takes savings bond to grassroots

    The Debt Management Office (DMO) has taken Federal Government of Nigeria (FGN) Savings Bond campaign to the grassroots. The debt office is  targeting traders  within the Federal Capital Territory, Abuja.

    Speaking at the Gudu District Market, Director, Portfolio Management Department, Oladele Afolabi, told traders that the Federal Government is committed to promoting a good savings culture amongst Nigerians. He said the DMO will sustain campaign to encourage more people to invest in the Savings Bond.

    “We are here to let you know that what the Federal Government is offering is real. Government wants you to save and earn good interests on what you save. Saving with your government is the best way to save,” Afolabi disclosed.

    The traders were told that the Savings Bond belongs to the people, hence, the decision to involve ordinary Nigerians on the streets, in the markets, churches and mosques.

    The Gudu market outing is the first of many other awareness initiatives that the DMO will be undertaking to have Nigerians invest in the Savings Bond.

  • What Nigeria stands to gain from $3b Eurobond, by DMO chief

    What Nigeria stands to gain from $3b Eurobond, by DMO chief

    •DG says offer oversubscribed by 400 per cent

    The Federal Government plans to use the proceeds of the $3 billion Eurobond Offer it issued in two tranches of $1.5 billion for 15 years and $1.5 billion for 30 years to refinane domestic debts.  The offer, issued through the Debt Management Office (DMO) was oversubscribed by 400 per cent. In this report by COLLINS NWEZE, the DMO Director-General, Ms. Patience Oniha, explains the government’s debt management strategy and the envisaged impact of the offer on the economy. THERE were high expectations within the International Capital Market (ICM) when the Federal Government announced plans to raise $5.5 billion with the backing of the Debt Management Office (DMO).

    In line with the government’s debt management strategy, the $5.5 billion has two components. The first – $2.5 billion to part-finance the 2017 Appropriation Act deficit and $3 billion Eurobond to be borrowed from external sources and proceeds targeted at repaying maturing domestic debt obligations.

    So, when the $3 billion Eurobond offer eventually came and was oversubscribed by 400 per cent, the DMO Director-General, Ms. Patience Oniha attributed the success to foreign investors’ appetite for Federal Government’s instruments. The DMO chief, who oversaw the successful issuance of the country’s first Sovereign Sukuk of N100 billion, also gave further details.

    On plans to raise $5.5 billion from the international financial markets, Ms. Oniha explained the federal government’s strategy.

    She said: “The DMO had for several years raised funds for the government largely in the domestic market through FGN Bonds and Nigerian Treasury Bills, and to a limited extent, from external sources mainly the multilaterals.

    “While this had a beneficial effect of developing the domestic debt capital market, the government became the dominant issuer to the extent that it has been regularly accused of crowding out the private sector.

    “The outcome was obviously not intentional, but to remedy the situation. The DMO deemed it fit to shift some of the borrowing activities to the international financial markets. This is also in line with its debt management strategy of achieving a portfolio mix of 60 per cent domestic and 40 per cent external.

    “Through the strategy, the share of domestic debt has been brought down from over 85 per cent to 77 per cent as at September this year.”

    Giving insights into the components the DMO director0general said: “The $5.5 billion is made up of two components, the first of which is $2.5 billion to part-finance the deficit in the 2017 Appropriation Act. The 2017 Appropriation Act included new borrowings of N1.254 trillion from the domestic market and N1.068 trillion equivalent of about $3 billion from external sources.

    “As at October 2017, only $300 million in the form of a Diaspora Bond had been raised leaving an unfunded balance of $3.2 billion. The other component of the $5.5 billion external capital raising is the $3 billion whose proceeds are to be used to repay some maturing domestic debt obligations.”

    Speaking on the benefits expected from borrowings, she said: “The DMO’s role in financing budget deficits  as provided in Annual Appropriation Acts, are to support  budget implementation and the attainment of the government’s economic targets. The $2.5 billion is specifically targeted at fulfilling the DMO’s mandate in this regard.

    “On the $3 billion for refinancing domestic debt, there are several benefits for the action. Firstly, it will reduce the crowding out effect that I earlier referred to thereby creating more space for other borrowers in the domestic market.

    “It also has the potential to bring about a reduction in lending rates which would make the cost of production of goods and services by the private sector cheaper and more price-competitive.

    “Another major benefit of raising external capital is a lower cost of borrowing to government and a moderation in debt service costs. As you know, United States (U.S.) dollar interest rates are much lower than naira interest rates. The $1.5 billion 10-year and $1.5 billion 30-year Eurobonds were issued at coupons of 6.5 per cent and 7.625 per cent per annum respectively.

    “These coupons are certainly much lower than the 15 per cent to 17 per cent that the government borrows at in the domestic market for shorter tenured funds. There is also the fact that the $3 billion is a direct accretion to Nigeria’s external reserves which are extremely useful for managing the naira exchange rate.”

    Ms. Oniha explained what accounted for the over-subscription of the Eurobonds by over $11 billion (about 400 per cent of the $3 billion that the government took) and her agency accepted less than the $5.5 billion approved by the National Assembly.

    Her words: “The demand of over $11 billion from international investors is a demonstration of their confidence in the policies and reform initiatives of President Muhammadu Buhari as well as the economic outlook of Nigeria.

    “Like those investors, we ourselves can attest to the economic improvements in Nigeria as demonstrated by higher external reserves, stable exchange rate, Gross Domestic Product (GDP) growth of 1.44 per cent in the third quarter of 2017 and improvement in the Ease of Doing Business.

    “Our intention was not to raise the $5.5 billion at once. Our first priority was to raise the $2.5 billion required for the 2017 budget while the $3 billion required for refinancing domestic debt will be in a phased manner.

    “Also, from a technical perspective, we still wanted to moderate the cost even in the International Capital Market by managing the supply of Nigeria’s Eurobonds in the market.”

    On the significance of the 30-year Eurobond being issued for the first time in the country, she said: “It is remarkable that international investors were willing to take a long term risk on Nigeria by buying the 30-year Eurobond. This feat is even more remarkable when we consider that South Africa which has a superior sovereign rating of BB- compared to Nigeria’s B+/B rating is the only sub-Saharan country that has issued a 30-year bond in the International Capital Market.

    “The other outstanding aspect of the 30-year Eurobond is its Pricing at 7.625 per cent which is lower than the coupon of 7.875 per cent on the $1.5 billion 15-year Eurobond issued earlier in the year.

    “In terms of its specific benefits to Nigeria, it provides the appropriate funds for financing infrastructure which is typically long term while also reducing the refinancing risk of the debt stock.

    “It will also serve as a benchmark for local and foreign institutions which may need to raise long term dollar funds to invest in Nigeria under various Private Public Partnership (PPP) arrangements for infrastructure as well as privatisation.”

    She said the fresh borrowings from the International Capital Market will not anyway worsen the country’s debt burden.

    The DMO chief said: “I want to re-assure Nigerians that the government’s borrowings are pre-approved by the executive and legislative arms of government and are used to finance various activities of the government as appropriated.

    “These layers of approvals ensure that the borrowings are both necessary and scrutinised before the DMO embarks on actual borrowing.    The increasing focus by the current administration of using borrowed funds for infrastructural development is a step in the right direction.

    “As borrowing is deployed to infrastructure to promote economic growth, the benefits of job creation and increased production among benefits are good for all Nigerians.

    “Besides, the debate on debt burden should therefore shift to actively supporting the government to increase revenue to levels comparable to the sub-Saharan average of 17 per cent of GDP. The other part of the argument about debt becoming a burden is the issue of Nigeria’s revenue base which at six per cent of GDP is not only low but well below that of peer countries.

    “Interestingly, government’s revenue is now being given proper attention. The measures to increase revenues are already yielding some results, and as this trajectory continues, the need for borrowing is expected to reduce while debt service will become an increasingly smaller portion of revenue.”

     

  • DMO: Nigeria’s debts hit N20tr

    DMO: Nigeria’s debts hit N20tr

    • Senate okays $5.5b loan request

    Data made available by the Debt Management Office (DMO) yesterday showed that Nigeria’s debt stock has hit N20 trillion—as at September 30.

    Domestic debt accounts for 76.96 per cent of this figure while foreign debt accounts for 23.04 per cent.

    In figures, domestic debt stood at N15.679 billion, an increase of 4.1 per cent from the N15.034 trillion recorded in June.

    Foreign debt stood at N4.694 trillion, a rise of 1.9 per cent above the N4.602 trillion as at June 30.

    According to the DMO, the figures show that the federal government was more inclined to domestic debt, which is partly responsible for the high debt service figures.

    This year, the Federal Government issued various debt instruments like the N100 billion Sukuk for road construction, monthly FGN Savings bond and the Eurobond.

    The Federal Government has already expressed intentions in raising $5.5 billion externally.

    According to Finance Minister, Mrs. Kemi Adeosun, $2.5 billion will be used to part finance the N2.322 trillion deficit in the 2017 budget and $3 billion to repay maturing domestic debt.

    This will also contribute to attaining the target 60:40 domestic and external debt ratio.

    The office said other benefits expected from the plan are: increased availability of funds to the private sector and lower domestic lending rates; both of which will contribute to the growth of the private sector and increase the level of external reserves to support the naira.

    Also, the Senate yesterday approved the request of President Muhammadu Buhari to borrow $5.5 billion.

    Of the $5.5billion,  $2.5 billion, according to the presidential request, will be used to fund the 2017 budget while the balance of $3 billion is meant to refinance domestic debts.

    Nigeria’s debt profile stood at N19.6 trillion as at June 30 of this year, according to the Debt Management Office (DMO) document.

    Before the unanimous approval of the loan, some senators however called for caution on the way and manner the Federal Government rushes to take foreign loans.

    The lawmakers particularly expressed fear that the ability of the country to repay the loans might be limited if the national currency depreciates further.

    One of them, Senator Yusuf Abubakar Yusuf, (Taraba central),  said: “We must be very careful because this is dependent on what happens in our foreign reserves. If our foreign exchange rate goes to N500/USD1, we are going to have a very serious problem on generating enough foreign exchange to pay the foreign debts.”

    The approval of the loan followed the adoption of the report of the Committee on Local and Foreign Debts that vetted the request sought partly to finance the deficit in this year’s  budget.

    Chairman of the Committee, Senator Shehu Sani told the Senate that “the terms and conditions of the loan are favourable and do not pose any compromise to the integrity, independence and interest of Nigeria and its citizens.

    “The projects are essential for rapid economic and social development of Nigeria. And that the projects, when completed, will create jobs through a chain of economic activities.”

    The committee noted that the $3 billion local debt refinancing cash will not lead to an increase in the public debt portfolio but will reduce the cost of the debts while the projects are essential for rapid economic and social development of Nigeria.

    It said  the construction of the second runway in the Nnamdi Azikiwe International Airport will enhance the safety of air passengers, increase the use of the airport by international airlines, “thus increase the revenue base of the government.”

    It said the rail projects, when completed, will reduce the use of roads, its attendant congestion and thus minimise the cost of road maintenance.

  • FG savings bond opens for investors at high yields

    FG savings bond opens for investors at high yields

    The Federal Government has offered for subscription two-year and three-year Savings Bonds to investors at 13.535 per cent and 14.535 per cent, respectively. The monthly offer opens today and ends on Friday, August 11.

    A statement from the Debt Management Office (DMO) said the two-year bond will be due in August 2019, while the three-year bond has a maturity date of August 2020.

    The offer has a minimum subscription of N5,000 with increases thereafter in multiples of N1,000 up to a maximum subscription of N50 million.

    The debt office said the bond is backed by the full faith and credit of the Federal Government, with quarterly coupon payments to bondholders.

    The DMO stated that the savings bond will help broaden the country’s funding base. The Federal Government of Nigeria (FGN) Savings Bond is targeted primarily at retail investors to enable them to contribute to the development of the country, while also earning good returns on a safe investment in a Sovereign instrument.

    The FGN Savings Bond was launched by the DMO in March 2017 and is issued every month through stockbroking firms trading on the Nigerian Stock Exchange. The FGN Savings Bond is promoting the savings culture in the country and enhancing financial inclusion.

    Since its introduction in March, the FGN Savings Bond has attracted a lot of new investors to the FGN Securities market with its attractive features. The income earned on the FGN Savings Bond is exempted from taxes and it can be traded in the secondary market on the Nigerian Stock Exchange.

  • DMO allots N400.5m in savings bond sales

    DMO allots N400.5m in savings bond sales

    The Federal Government has allotted N400.5 million in its July 2019 and 2020 savings bond sales, the Debt Management Office (DMO) has said.

    The allotment results were obtained from the DMO’s website yesterday.

    About N160.7 million was allotted at 13.38 per cent, with 342 successful subscriptions to mature in July 2019.

    DMO noted that N239.8 million was allotted at 14.38 per cent, with 437 successful subscriptions to mature in June 2020.

    The savings bond was introduced in March. It is targeted at low income earners to encourage them to save and earn more income (interest) compared to their savings accounts with banks.

    It is also expected to help finance the nation’s budget deficit.

    The bonds are debt securities (liabilities) of the government backed by its “full faith and credit”.

    Interests are to be paid at regular periods and principal repaid at maturity.

    The bond has a tenure of between two and three years and a minimum size of investment of N5,000 and maximum of N50 million.

    It is aimed at deepening national savings culture, diversifying funding sources for the government and providing opportunity to all citizens, irrespective of income level to contribute to national development.

    It will also enable all citizens to participate in and benefit from the favourable returns available in the capital market.

    The next offer will open on Aug. 7 and close on Aug. 11, the DMO said.

    In another development, the DMO sold N105.96 billion worth of five, 10 and 20 year bonds, an amount less than the N135 billion it initially proposed to issue.

    According to the auction results, it allotted N47.01 billion of the 10 year paper to mature in March 2027 at 16.25 per cent, while N55.05 billion worth of the 20 year bond to mature in April 2037 was sold at 16.25 per cent.

    It sold N3.90 billion worth of the five-year paper to mature in July 2021 at 16.24 per cent, much lesser than the N35 billion initially offered by the DMO.

  • DMO raises N106b through FGN Bond Auction

    DMO raises N106b through FGN Bond Auction

    The Debt Management Office (DMO) has raised N106 billion through the Federal Government of Nigeria (FGN) Bonds. The funds raised will     support the implementation of the Federal Government’s N7.44 trillion 2017 budget, which has an allocation of N2.36 trillion to capital expenditure.

    The     funds were raised after the DMO, in line with its mandate, conducted an     Auction of FGN Bonds   to provide funds for the implementation of  the budget.

    The bonds, the DMO said, were offered in three tenors    of 5, 10 and 20 years to meet the needs of various investors. The total subscription was  N129 billion, representing 96 per cent of the amount   offered.   The   10   and   20-year   Bonds   were   oversubscribed,   showing    investors preference for long-dated Bonds.

    Based on the bids received at the Auction, the DMO allotted a total of N106  billion and the rates were 16.24 per cent for the 5-year, 16.25 per cent for    the 10-year and 16.2514 per cent for the 20-year Bond.

    The 2017 budget is an integral part of the Economic Recovery and Growth Plan  (ERGP).  While  there’s   noticeable  alignment  between  the   Federal Government budget and the ERGP, full implementation of capital projects   in the budget is critical to achieving the desired development and recovery.

    Analysts   said   the   budget   is   a   catalyst   for   economic   recovery   and   is   expected to help stimulate the economy, build infrastructure, deliver growth    and will be implemented based on resources from government revenue    and borrowing.

    The highlight of the budget also showed that the Ministry of Power, Works    & Housing got the highest vote of N586.54 billion. The Transport Ministry    got N256.52 billion and Education and Health ministries were allocated  N455.41 billion and N308.46 billion respectively.

    Allocations   to   Power,   Works   &   Housing   and   Transport   show   serious    intention to develop infrastructure and the proceeds from the DMO-issued bonds is expected to help in achieving this objective.

  • DMO: govt to raise N450b in sovereign bonds by Q3

    DMO: govt to raise N450b in sovereign bonds by Q3

    •Bonds to mature five, 20 years

    The Federal Government has unveiled plans to raise between N360 billion and N450 billion ($1.18 billion to $1.48 billion) in sovereign bonds maturing between five and 20 years in the third quarter, the Debt Management Office (DMO) has said.

    The debt office said it would auction N90 to N120 billion in the five-year note and N135 to N165 billion in the 10-year and 20-year debt between July and September.

    Nigeria issues bonds each month to help fund its budget deficit, support the local debt market and maintain a benchmark for companies to follow.

    Nigeria expects a budget deficit of N2.36 trillion this year as it tries to spend its way out of a recession. It expects to raise money to cover more than half the gap from the local market.

    Nigeria recently issued $300 million Diaspora bond on the London Stock Exchange. It was in 2013 that the country unveiled plans to sell diaspora bonds worth between $100 million to $300 million to Nigerians living abroad. But the government at the time did not appoint a book runner to actualise the plan.

    According to the bond issuance plan, a road show started yesterday with meetings planned in Britain, Switzerland and the United States. “Nigeria has filed a registration statement for the Bonds with the United States Securities and Exchange Commission,” the statement said, adding that the Bonds would be listed in London. It gave no price expectations.

    Nigeria, grappling with its first recession in 25 years that was largely brought on by low oil prices and the impact of attacks on energy facilities in the Niger Delta, has set a budget of N7.44 trillion ($23.66 billion) for this year. More than 50 per cent of the N2.21 trillion deficits in 2017 budget will be funded through external borrowing.

  • Osinbajo appoints Oniha as DMO chief

    Osinbajo appoints Oniha as DMO chief

    Acting President Yemi Osinbajo on Friday approved the appointment of Mrs. Patience Oniha as the new Director-General of Debt Management Office (DMO).

    The Minister of Finance, Mrs. Kemi Adeosun, announced the appointment in Abuja.

    Oniha, from Edo State, takes over from the former Director-General, Abraham Nwankwo, who retired after serving for two terms of five years each.

    The handover formalities took place in a brief ceremony held at the DMO office in Abuja.

    The new DG contributed greatly to the success DMO achieved in the last 10 years.

    She retired as a director in the agency and also served in the Efficiency Unit of the Ministry of Finance before her recent appointment as DMO chief executive.