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FG’s June Bonds Oversubscribed by N60.13bn

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  • FG’s June Bonds Oversubscribed by N60.13bn

The Federal Government’s bonds June worth N100bn, which was offered on Wednesday, was oversubscribed by over N60.13bn.

Total subscription received from investors for the bonds was N160.13bn, comprising N39.34bn for 12.75 per cent FGN April 2023 bonds; N60.30bn for 14.55 per cent FGN April 2029 bonds; and N60.49bn for 14.80 per cent FGN April 2049 bonds.

Recent trends in the FGN bonds also showed that investors were embracing the long-term bonds, as the recent five, 10 and 30-year bonds had 43, 58 and 62 total bids respectively.

The auction result added that 19, 22 and 30 bids were, however, successful for the three bonds allotted.

The Debt Management Office had earlier disclosed its plans to auction bonds worth N100bn by subscription.

Its circular showed the breakdown of the figure to include a N30bn five-year reopening bond that would mature in April 2023 and be offered at 12.75 per cent; another N40bn 10-year reopening bond that would mature in April 2029 and be auctioned at 14.55 per cent; while N30bn 30-year bond would mature in April 2049 and be auctioned at 14.8 per cent.

A total of N96.84bn was, however, allotted comprising N28.99bn for 12.75 per cent FGN April 2023 bonds; N36.36bn for 14.55 per cent FGN April 2029 bonds; and N31.49bn for 14.80 per cent FGN April 2049 bonds.

The DMO stated in its June auction result on Wednesday that “successful bids for the 12.75 per cent FGN April 2023, 14.55 per cent FGN April 2029, and 14.80 per cent FGN APR 2049 were allotted at the marginal rates of 14.3 per cent, 14.5 per cent and 14.68 per cent respectively.

“However, the original coupon rate of 12.75 per cent for the 12.75 per cent FGN April 2023, 14.55 per cent for the 14.55 per cent FGN April 2029 and 14.80 per cent for the 14.80 per cent FGN APR 2049 will be maintained.”

In addition, it stated that N13.50bn of the 14.55 per cent FGN April 2029 was allotted on non-competitive basis.

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