Press Release: Towards Financing Infrastructure, Debt Management Office to Issue Another Sovereign Sukuk

Tuesday, 02 November 2021 11:49

PRESS RELEASE

Towards Financing Infrastructure: Debt Management Office to Issue Another Sovereign Sukuk

 

The Debt Management Office (DMO) is set to issue another Sovereign Sukuk this year for an expected amount of N200 - N250 billion to finance critical road projects across the country.

The DMO commenced the issuance of Sukuk in September 2017 as a strategic initiative to support the development of infrastructure, promote financial inclusion and deepen the domestic securities market. Subsequent to the debut Sovereign Sukuk in 2017 in which N100 billion was raised to finance the rehabilitation and construction of twenty-five (25) road projects across the six (6) geopolitical zones, the DMO issued a Sukuk for N100 billion in 2018 and another for N162.557 billion in 2020. The proceeds of these two (2) Sukuk issuances were also deployed to twenty-eight (28) and forty-four (44) road projects, also in the six (6) geopolitical zones. In summary, a total of N362.577 billion Sovereign Sukuk was issued between September 2017 and June 2021.

Since the debut Sovereign Sukuk in September 2017 whose benefit in terms of improved road infrastructure within and outside cities in Nigeria is clearly visible, the Sukuk has been commended as a viable instrument for financing infrastructure. The use of Sukuk, has enabled timely completion of the designated projects whilst also delivering the multiplier effects associated with construction of capital projects such as roads.

The DMO has already appointed Transaction Parties through the Open Competitive Bidding Process for the issuance of this fourth Sovereign Sukuk. The Transaction Parties and their respective roles are stated below:

                                        a. Issuing Houses     -      Stanbic IBTC Capital Limited, Greenwich Merchant Bank Limited

                                                                 and Vetiva Capital Management Limited.

                                        b. Financial Adviser -       BURAQ Capital Limited.

                                        c. Trustees       -             FBNQuest Trustees Limited and APEL Capital & Trust Limited

                                       d. Legal Advisers       -     Abdulai, Taiwo & Co. Solicitors and Tsedaqah Attorneys

From enquiries received from the media and investors, the DMO expects a high subscription level for the Sukuk when the Offer opens.

DEBT MANAGEMENT OFFICE

The Presidency

NDIC Building (First Floor),

Plot 447/448 Constitution Avenue,

Central Business District,

P.M.B. 532, Garki, Abuja

Tel: +234 - 8110000881-3

Website: http://www.dmo.gov.ng,

Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

                                                                                                                                                                       November 01, 2021

Press Release: Nigeria Raises USD 4 Billion through Eurobonds

Tuesday, 21 September 2021 20:01

The long tenors of the Eurobonds and the spread across different maturities are well aligned with Nigeria’s Debt Management Strategy, 2020 – 2023.

Since the Eurobonds were issued as part of the New External Borrowing in the 2021 Appropriation Act, the raising of USD4 billion through Eurobonds provides a significant amount of funds to finance projects in the Act, thus contributing to the implementation of the 2021 Appropriation Act.

DEBT MANAGEMENT OFFICE

The Presidency

NDIC Building (First Floor),

Plot 447/448 Constitution Avenue,

Central Business District,

P.M.B. 532, Garki, Abuja

Tel: +234 - 8110000881-3

Website: http://www.dmo.gov.ng,

Press Release: Nigeria Back at International Capital Market with Eurobond Offer

Thursday, 16 September 2021 14:30

 

PRESS RELEASE

Nigeria Back at International Capital Market with Eurobond Offer

The Federal Government of Nigeria has announced plans for a Eurobond issuance in the International Capital Market (ICM). The last time Nigeria accessed the ICM was November 2018. Virtual meetings with investors have been scheduled for September 17 and September 20, 2021. In order to avail local investors, the opportunity to invest in the Eurobonds, meetings will also be held with local investors. This is the first time local investors will be included in the Roadshows, and this is one of the reasons why a Nigerian Bookrunner (Chapel Hill Denham Advisory Services Ltd) was appointed as one of the Transaction Advisers.

Through the Eurobond issuance, Nigeria is expected to raise up to USD$3 billion but no more than USD$6.2 billion. The issuance for which all statutory approvals have been received, is for the purpose of implementing the New External Borrowing in the 2021 Appropriation Act. Proceeds are for the financing of various projects in the Act.

In addition to providing funding to part-finance the deficit in the 2021 Appropriation Act, the issuance of Eurobonds by Nigeria benefits the country in many other strategic ways; amongst which are:

  1. It is an inflow of foreign exchange, leading to an increase in External Reserves. External Reserves help support the Naira Exchange Rate, and Nigeria’s sovereign rating.
  2. When Nigeria raises funds externally, through Eurobonds, it frees up space in the domestic market for private sector and sub-national borrowers. In effect, it helps the sovereign not to crowd out other borrowers in the domestic market.
  3. The issuance of Eurobonds by Nigeria has opened up opportunities for Nigeria’s corporate sector notably banks, to issue Eurobonds to raise capital in the ICM. By so doing, their capital base has been strengthened to provide banking services whilst also meeting regulatory requirements. Nigeria has a sovereign yield curve in the ICM, extending up to 30 years.
  4. The local listing of Nigeria’s Eurobonds on the Nigerian Exchange Ltd. and the FMDQ Securities Exchange Ltd., have increased the range of products on these two (2) exchanges and their respective market capitalization.

Overall, Eurobond issuances by Nigeria and the investor meetings that precede the pricing, have provided a strong global platform for Nigeria to tell its own story and opportunities available in Nigeria for investors.

The Transaction Advisers appointed by Nigeria for the issuance are:

  1. International Bookrunners/   -     JP Morgan, Citigroup Global Markets Limited,

  1. Joint Lead Managers                    Standard Chartered Bank and Goldman Sachs.

  1. Nigerian Bookrunner             -     Chapel Hill Denham Advisory Services Ltd
  2. Financial Adviser                  -      FSDH Merchant Bank Ltd                    
  3. International Legal Adviser    -     White & Case LLP  

  1. Nigerian Legal Adviser             -   Banwo & Ighodalo

DEBT MANAGEMENT OFFICE

The Presidency

NDIC Building (First Floor),

Plot 447/448 Constitution Avenue,

Central Business District,

P.M.B. 532, Garki, Abuja

Tel: +234 - 8110000881-3

Website: http://www.dmo.gov.ng,

Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

September 16, 2021

Press Release: Towards Financing the 2021 Appropriation Act – FGN Appoints Transaction Advisers for a Eurobond Issuance

Wednesday, 04 August 2021 15:24

                                                                                                                                                                                                                                                                                                                                                                                                               

The Transaction Advisers emerged from an Open Competitive Bidding Process as outlined in the Public Procurement Act, 2007 (as amended). A total of thirty-eight (38) institutions responded to the Expression of Interest, and after rigorous evaluation to ascertain the technical capacities of the responders to execute the Transaction, the eight (8) institutions above were selected. With the approval of the Transaction Advisers by FEC, the Debt Management Office (DMO) will now accelerate activities towards the Issuance of the Eurobonds. It will be recalled that the Resolutions of the Senate and the House of Representatives, in compliance with the Debt Management Office (Establishment, Etc.) Act, 2003 and Fiscal Responsibility Act, 2003, had earlier been secured.

The Eurobonds to be issued, are for the purpose of raising funds for the New External Borrowing of N2.343 trillion (about USD6.2 billion) provided in the 2021 Appropriation Act to part finance the Deficit. Whilst the Government expects a successful outing, it will be mindful of costs and risks (in terms of tenor and pricing) in determining the amount of Eurobonds to issue.

Since the Eurobonds are being issued to part finance the 2021 Budget Deficit, the proceeds will be used to fund various projects in the Budget. In addition, the proceeds will result in an inflow of foreign exchange which in turn, will increase Nigeria’s External Reserves and support the Naira Exchange Rate.

DEBT MANAGEMENT OFFICE

The Presidency

NDIC Building (First Floor),

Plot 447/448 Constitution Avenue,

Central Business District,

P.M.B. 532, Garki, Abuja

Tel: +234 - 8110000881-3

Website: http://www.dmo.gov.ng,

Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

August 4, 2021

Press Release: Total Public Debt Stock as at March 31, 2021

Wednesday, 09 June 2021 12:24

The Debt Management Office has released Nigeria’s Public Debt Stock as at March 31, 2021. The Total Public Debt Stock which comprises of the Debt Stock of the Federal Government of Nigeria (FGN), thirty-six (36) State Governments and the Federal Capital Territory (FCT) stood at N33.107 trillion or USD87.239 billion. The Debt Stock also includes Promissory Notes in the sum of N940.220 billion issued to settle the inherited arrears of the FGN to State Governments, Oil Marketing Companies, Exporters and Local Contractors. Compared to the Total Public Debt Stock of N32.916 trillion as at December 31, 2020, the increase in the Debt Stock was marginal at 0.58%.

Further analysis of the Public Debt Stock, shows that the increase was in the Domestic Debt Stock which grew by 2.11% from N20.21 trillion in December 2020 to N20.637 trillion as at March 31, 2021. The FGN’s share of the Domestic Debt includes FGN Bonds, Sukuk and Green Bonds used to finance infrastructure and other capital projects as well as the N940.220 billion Promissory Notes. External Debt Stock declined from USD33.348 billion as at December 31, 2020 to USD32.86 billion due to the redemption by Nigeria of the USD500 million Eurobond in January 2021.

DEBT MANAGEMENT OFFICE

The Presidency

NDIC Building (First Floor),

Plot 447/448 Constitution Avenue,

Central Business District,

P.M.B. 532, Garki, Abuja

Tel: +234 - 8110000881-3

Website: http://www.dmo.gov.ng,

Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

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June 8, 2021

The Debt Management Office has released Nigeria’s Public Debt Stock as at March 31, 2021. The Total Public Debt Stock which comprises of the Debt Stock of the Federal Government of Nigeria (FGN), thirty-six (36) State Governments and the Federal Capital Territory (FCT) stood at N33.107 trillion or USD87.239 billion. The Debt Stock also includes Promissory Notes in the sum of N940.220 billion issued to settle the inherited arrears of the FGN to State Governments, Oil Marketing Companies, Exporters and Local Contractors. Compared to the Total Public Debt Stock of N32.916 trillion as at December 31, 2020, the increase in the Debt Stock was marginal at 0.58%.

 

Further analysis of the Public Debt Stock, shows that the increase was in the Domestic Debt Stock which grew by 2.11% from N20.21 trillion in December 2020 to N20.637 trillion as at March 31, 2021. The FGN’s share of the Domestic Debt includes FGN Bonds, Sukuk and Green Bonds used to finance infrastructure and other capital projects as well as the N940.220 billion Promissory Notes. External Debt Stock declined from USD33.348 billion as at December 31, 2020 to USD32.86 billion due to the redemption by Nigeria of the USD500 million Eurobond in January 2021.

 

 

 

 

 

 

 

DEBT MANAGEMENT OFFICE

The Presidency

NDIC Building (First Floor),

Plot 447/448 Constitution Avenue,

Central Business District,

P.M.B. 532, Garki, Abuja

Tel: +234 - 8110000881-3

Website: http://www.dmo.gov.ng,

Email: .">This email address is being protected from spambots. You need JavaScript enabled to view it.

 

June 8, 2021

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