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The Historic Listing of $1bn Eurobond on NSE

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  • The Historic Listing of $1bn Eurobond on NSE

The Federal Government recently achieved remarkable success with the issuance of its first FX-denominated bonds.

The bond, issued under Nigeria’s newly established Global Medium Term Note programme, is the third in the series after the ones in 2011 and 2013. The Notes will bear interest at a rate of 7.875 per cent and will mature on February 16, 2032, with a bullet repayment of the principal.

The Eurobond, which is part of federal government’s funding strategy for its 2016 capital expenditure plan will be utilised to fund key infrastructure projects, in line with its economic plan. The Notes were approximately eight times oversubscribed with orders in excess of US$7.8 billion compared to a pre-issuance target of US$ 1.0 billion.

Following the massive 780 per cent subscription to the bonds, it was admitted to the official list of the UK Listing Authority and available to trade on the London Stock Exchange’s regulated market. Many analysts have attributed this huge oversubscription rate to a buoyant investor appetite for building exposure to Nigeria and the demonstration of international capital markets confidence in the Nigeria’s economic reform agenda.

The Notes were issued following a successful one-week roadshow led by the Minister of Finance, Mrs. Kemi Adeosun, to key global financial centres – London, Los Angeles, Boston and New York. Other members of the delegation include Minister of Budget and National Planning, Senator Udoma Udo Udoma; Governor of the Central Bank of Nigeria; Godwin Emefiele, Director-General of the Debt Management Office (DMO),Dr. Abraham Nwankwo; and Director General of the Budget Office, Ben Akabueze,

In line with federal government’s commitment to the development of the domestic capital market, Debt Management Office (DMO) last Thursday, listed the $1 billion (FGN) Eurobond on the floor of The Nigerian Stock Exchange.

The 15-year Sovereign is the first foreign currency denominated security to be listed and traded in the Nigerian capital market. The minimum denomination to participate in the bond is USD200,000 and increment of USD 1000.

First, DMO DG, Dr. Abraham Nwankwo, and parties to the listing were hosted to a pre-listing meeting at the council of the exchange where the Executive Director, Market Operations and Technology, Mr. Ade Bajomo, received the team. In his brief remarks at the pre-listing event, Dr Nwankwo described NSE “a great stock exchange, the pride of Nigeria.”

At the Facts Behind the Listing presentation at the stock exchange, Nwankwo noted that, “The listing of domestic Sovereign Eurobond on the local bourse reinforces FGN’s commitment to deepen and grow the Nigerian capital market. Developing the domestic market can help bridge the infrastructure deficit constraining economic growth.”

Also speaking on the listing, the Executive Director, Market Operations and Technology, Mr. Ade Bajomo, commended the DMO for listing the Eurobond on the nation’s bourse. He noted that the domestic listing would diversify its investors’ base by giving Nigerian institutional investors access to the bond.

Bajomo further remarked that, “The listing of the dollar-denominated bond on the exchange will boost price discovery and liquidity in the local market as well as help attract reliable long term foreign currency denominated funds into the financial market. It would also set the foundation for raising and listing more foreign denominated securities in Nigeria which will open up additional capital raising options for issuers and portfolio diversification opportunities to investors”.

To ensure seamless trading and settlement of the Eurobond, the Exchange, in collaboration with Central Securities Clearing System (CSCS), developed a framework to facilitate onshore and cross border trade and settlement process in line with robust market practices.

At its 2016 NSE Market Recap & 2017 Outlook, the Exchange’s Chief Executive Officer, Mr Oscar N. Onyema, had raised hopes of a possible buoyant capital market in 2017. He stated that, “There will be a revival of supplementary listings, return of the new issuance market, and potentially one IPO since the equity market is a forward indicator of the economy. We are cautiously optimistic, as consensus estimates suggest a moderate recovery for Nigeria in 2017, provided that policy makers implement the right combination of policy measures.”

To reinforce this, NSE has gone on a listing spree from the beginning of the year. To date, it has listed the Stanbic IBTC Asset Management Limited listed Pension ETF 40, Top Services Limited listed a Real Estate Investment Trust, Forte Oil listed a N9 Billion Bond etc. With the listing of two companies by introduction at the beginning of the year, Medview Airline and Jaiz Bank added N14.65billion and N36.83billion respectively to the bourse’s market capitalisation.

It would be recalled that MTN, the telecommunications giant, had indicated interest to list on the exchange by 2017. According to experts, MTN listing on the Nigerian Stock Exchange would increase the market capitalisation by about 22 per cent.

The Securities and Exchange Commission (SEC) and NSE have been consistent in its advocacy to the federal government to encourage multinational companies operating in the country to list on the exchange, to give Nigerians the opportunity to benefit from their investments.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Insurance

Heirs Insurance Group Unveils Revolutionary Website for Seamless Insurance Experience

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Heirs Insurance Group has launched a website designed to revolutionize the insurance experience for its customers.

With a focus on simplicity, accessibility, and personalized service, the new website aims to streamline the process of obtaining insurance coverage and empower customers to make informed decisions about their insurance needs.

The website boasts a range of innovative features that make navigating insurance options easier than ever before.

From simple and intuitive navigation menus to personalized insurance recommendations, the website is designed to guide customers through every step of the insurance process quickly and efficiently.

According to Ifesinachi Okpagu, the Chief Marketing Officer of Heirs Insurance Group, the new website embodies the company’s commitment to delivering exceptional customer service.

“Today’s customers want simplicity, and this new website delivers on that request,” Okpagu said. “We are empowering customers to take control of their lives, their businesses, assets, and their most cherished people.”

One of the key features of the website is its personalized insurance experience, which takes customers through a short journey to help them identify the best insurance plan for their needs.

Whether customers are looking for coverage for their home, car, business, or loved ones, the website provides tailored recommendations to ensure they find the right insurance solution quickly and easily.

With its user-friendly interface and innovative features, the new website from Heirs Insurance Group sets a new standard for the insurance industry, making it easier than ever for customers to protect what matters most to them.

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Banking Sector

Safaricom, Access Holdings Forge Partnership to Revolutionize Remittance Corridor in Africa

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Safaricom, the leading telecommunications company in Kenya, has entered into a strategic partnership with Access Holdings, spearheaded by Aigboje Aig-Imoukhuede.

The collaboration aims to revolutionize the remittance corridor between East and West Africa, marking a significant step towards enhancing financial inclusion and empowering millions of individuals across the continent.

The partnership comes on the heels of Access Holdings’ recent acquisition of the National Bank of Kenya Limited, signaling the company’s ambitious expansion into the East African market.

Leveraging Safaricom’s extensive network and expertise in mobile money through M-Pesa, which currently dominates the mobile money market in Kenya, the alliance seeks to create seamless and efficient channels for remittance transactions.

Aigboje Aig-Imoukhuede, the driving force behind Access Holdings, expressed enthusiasm about the collaboration, highlighting its potential to transcend traditional boundaries and foster greater economic connectivity between East and West Africa.

He highlighted the fusion of collective expertise and resources between the two entities, underlining their shared commitment to driving financial inclusion and empowerment across the continent.

The partnership holds promise for addressing the challenges faced by millions of Africans in accessing affordable and reliable remittance services.

By connecting more than 60 million customers and 5 million businesses across eight countries, the collaboration aims to facilitate over $1 billion in daily transaction value, significantly boosting the flow of remittances within and outside Africa.

With the first phase of the collaboration focusing on key markets such as Nigeria, Kenya, Ghana, and Tanzania, stakeholders anticipate a transformative impact on the remittance landscape, paving the way for greater intracontinental trade and economic integration in line with the objectives of initiatives like the African Continental Free Trade Area (AfCFTA).

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Banking Sector

EFCC Urged to Repatriate Recoveries to NDIC for Depositors’ Relief

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The Nigeria Deposit Insurance Corporation (NDIC) has made a fervent plea to the Economic and Financial Crimes Commission (EFCC) to expedite the repatriation of recovered funds to its coffers to facilitate the timely reimbursement of depositors affected by bank failures.

During a recent meeting between the Managing Director of NDIC, Bello Hassan, and the Executive Chairman of the EFCC, Ola Olukoyede, at the NDIC headquarters in Abuja, Hassan stressed the importance of enhanced collaboration between the two agencies in recovering depositors’ funds lost due to bank failures.

Hassan emphasized that the return of recoveries made by the EFCC on behalf of the NDIC would significantly contribute to the prompt reimbursement of affected depositors.

He commended the EFCC for its unwavering efforts in combating corruption and financial crimes, highlighting its crucial role as a key member of the Taskforce on Implementation of the Failed Banks Act chaired by the NDIC.

The NDIC boss also highlighted the existing partnership between the two organizations, which led to the establishment of the NDIC Help Desk at the EFCC in 2022.

He disclosed that several high-profile cases referred to the EFCC were currently under investigation.

In response, Olukoyede reiterated the EFCC’s commitment to collaborating closely with the NDIC to combat financial crimes and safeguard the integrity of the Nigerian banking sector.

He pledged to intensify efforts to repatriate recovered funds promptly, acknowledging the interconnectedness between criminal activities and bank failures.

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