Federal Government Nigeria Bonds Record 60% Over-Subscription

By June 28, 2019 Investment News

The June edition of the monthly Federal Government bond auction was over-subscribed by about 60 per cent.  According to Debt Management Office, DMO, the exercise, which was conducted yesterday, was a demonstration that the high demand for Federal Government bonds was being sustained in the capital market.

The debt management agency of the Federal Government offered three instruments totalling N100 billion to the investing public at the auction with 5, 10 and 30-year tenors.

Subscriptions for the three instruments from competitive bids was slightly above N160 billion, indicating an oversubscription of 60 per cent.

“Investors’ appetite for longer tenored instruments remained strong, with the 30-year bond oversubscribed by 100 per cent. The 10-year bond was also oversubscribed by over 50 per cent, while the five-year tenor was 31 per cent oversubscribed,” the DMO said.

It disclosed that allotments were made to successful bidders at 14.3 per cent for the five-year, 14.5 per cent for the 10-year and 14.68 per cent for the 30-year bonds.

The DMO put total allotments from the competitive offer at N96.84 billion in addition to an allotment of N13.50 billion on non-competitive basis for the 10-year bond, also at the rate of 14.5 per cent.

Source: Vanguard