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DMO Lists FG’s Second N100bn Sukuk on NSE



Debt Management Office
  • DMO Lists FG’s Second N100bn Sukuk on NSE

The Debt Management Office has listed a second Federal Government N100bn Ijarah Sukuk on the Nigerian Stock Exchange and the FMDQ OTC Plc.

The Director-General, DMO, Patience Oniha, while speaking at the investor presentation in Lagos, said the government was happy and proud of the success stories of the first Sukuk and decided to issue a second one.

She said a lot of encouragement was received from construction companies because they got their money as and when due, which made the projects go as planned.

She noted that the proceeds of the first Sukuk issuance, which was invested in road construction, brought reprive to road users, improved travel times between major commercial cities, linked borrowing and government expenditure to specific critical projects, helped increase the flow of cargo and passenger traffic across major cities, improved infrastructure delivery across the country, among others.

Oniha noted that the retail investors’ participation in the first Sukuk was about five per cent, adding that she hoped more retail investors would partake in the second one.

According to her, stockbrokers will be involved in the process to get a lot of retail investors to participate.

She said, “This second Ijarah Sukuk is due in 2025 and has a rental rate of 15.743 per cent. We listed the Sukuk on the NSE and the FMDQ on Thursday, which was the date it opened, and it will close on December 17, 2018.

“The allotment date is December 21, 2018. The proceeds from the Sukuk will be invested in road infrastructure development, just like the last one. Though the proceeds will not see the roads to completion, it will go a long way in improving the state of our roads.”

Oniha stated that the first Sukuk ensured the execution of road projects across all regions of the country, adding that it also led to a multiplier effect that created jobs around the country.

“The first Sukuk increased retail participation in the capital market as over N15.6bn of it has been traded since listing.” she said.

She added, “We are aware of the fear people have about the 2019 elections, but we want to assure you that no matter the government in power, debts will always be serviced and people will receive their money at maturity.

“The main objective of the second Sukuk is to sustain the rehabilitation and construction works on the 25 key economic roads in the six geopolitical zones with three roads now added for more reach.”

Oniha, however, noted that the DMO and the Federal Government were working to reduce the debt profile of the country as the ratio of debt service to revenue was higher than what it used to be.

According to her, if revenues are higher in the country, borrowing will reduce.

The DMO boss also noted that the tax to Gross Domestic Product ratio was low at six per cent, which she said were signs that citizens were not paying enough taxes.

She said, “This has to change. We cannot continue that way. Taxes will be introduced on select goods such as heavily-consumed goods.

“The Federal Inland Revenue Service is doing a lot to generate more taxes for the government and we will give them maximum support.”

The Deputy Managing Director, FBNQuest Merchant Bank Limited, Taiwo Okeowo, said operators were working to ensure Sukuk issuances become one of the major forms of fund raising for infrastructure by the government.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade experience in the global financial markets.


Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth



Godwin Emefile

Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth

The Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, has pledged to adopt accommodative monetary policy stance in 2021 in order to support economic growth in the country.

Emefiele, said this on Friday, while speaking at a CBN/Bankers’ Committee’s initiative for economic growth, which is a one-day special summit on the economy by bank chief executive officers.

The theme of the summit is: “How to Overcome the Pitfalls of Recession.”

Nigeria’s economy recently came out of recession, according to the Gross Domestic Product report for fourth quarter 2020 released by the National Bureau of Statistics.

Owing to the slump GDP growth of 0.11 per cent that lifted the economy out of recession, Emefiele said it was imperative that, “we do all we can in 2021 and beyond to ensure that we build on the positive momentum and strengthen our efforts at stimulating growth.”

He expressed optimism that with the discovery and deployment of vaccines worldwide, 2021 would be a year of massive global recovery and Nigeria must not be left out.

“The banks CEOs are here, whether by moral suasion or by force, they will have to participate in this journey. In order to drive and sustain this recovery therefore, we need to sustain the accommodative fiscal and monetary policy measures aimed at improving access to finance for households and businesses.

“Secondly, we must prevent a resurgence in Covid-19 related cases. Thirdly, we must ensure that a significant number of our population is significantly vaccinated and also improve foreign exchange inflows into our country,” he added.

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Banking Sector

CIT Microfinance Bank Disburses Over N16bn Loans




CIT Microfinance Bank Disburses Over N16bn Loans

CIT Microfinance Bank Limited says it has disbursed about N16bn loans since it commenced operations as part of its contributions to the financial sector and empowerment of businesses.

The Managing Director of the microfinance bank, Mr Kingsley Eremionkhale, disclosed this during the company’s 10th anniversary in Lagos recently.

He reiterated that the bank was committed to supporting the growth of small and medium-scale enterprises in the country.

“Since inception, we have disbursed loans worth about N16bn. Our operation is not just about profit-making, but we have impacted many lives, empowered many businesses, and done a lot in terms of our core mandate as a microfinance bank.”

While appreciating its customers who had been loyal to it for years, he said it was concerned about their business success.

The managing director said, “We are part of our customers’ businesses. We provide services beyond lending and savings products and we also give financial advisory services.”

He appreciated the customers who had stayed with the financial institution for many years.

The managing director noted that the MfB is a state-licensed bank operating in Lagos, and a subsidiary of Capitalfield Investment Group.

He also attributed the success of the MfB to the board of directors which it said had been supportive, the management team and its workforce in the past 10 years.

While saying that the bank could lay claims to exponential growth, he said the public should expect more from it.

He also said that it was driving its operations through its digital offerings and our e-channels, to improve its services to our customers.

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FMDQ Approves Valency Agro’s N5.12bn Commercial Paper




FMDQ Approves Valency Agro’s N5.12bn Commercial Paper

FMDQ Securities Exchange Limited has announced the approval of the quotation of the Valency Agro Nigeria Limited N5.12bn Series 1 Commercial Paper under its N20bn CP Programme on its platform.

The Exchange said in fostering the development of the Nigerian debt capital markets, it had continued to avail its credible and efficient platform as well as tailor its listings and quotations services to suit the needs of issuers and registration members through innovative and uninterrupted service delivery.

It said in a statement on Thursday that the Valency Agro Nigeria CP debut issue came at a time when the Nigerian economy was bedeviled with soaring food prices, amidst compounding challenges of insecurity.

It said the agricultural sector and its attendant transformation agenda had never been more important in driving increased and sustainable production of agricultural products as well as the derived foreign earnings through exports.

The Exchange said the proceeds from the issue of the CP would be applied by Valency Agro towards meeting the mid-term working capital requirements of the various agricultural produce under its portfolio such as cashew, sesame, cocoa and in value addition prior to export.

The Executive Director, Valency Agro Nigeria Limited, Mr Sumit Jain, was quoted as saying, “We are thankful to our investors towards showing their faith in our agenda to grow the agriculture-focused business with a clear aim to maximise value addition and create employment opportunities in Nigeria.

“We would also like to commend the efforts made by FBNQuest Merchant Bank Limited’s team to build the reach and FMDQ for their unconditional support for the industry”.

The Head, Capital Markets, FBNQuest Merchant Bank, Mr Oluseun Olatidoye, said, “FBNQuest Merchant Bank Limited is delighted with the successful debut of the N5.12bn Series 1 CP issued by Valency Agro Nigeria Limited. This reiterates our effort to enable underserved sectors access the debt markets, optimise their capital structure and further deepen the domestic capital markets.

“We are proud of the instrumental role FBNQuest Merchant Bank played in this transaction and appreciate the trust the management of Valency Agro placed in us to assist them. Our clients remain our priority, and we strongly believe their success is our success.”

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