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FG Bonds’ Investors to Reap N160bn Interest Payment in 2 Weeks

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Investors to Get N160bn Interest Payment in 2 Weeks

Federal Government of Nigeria (FGN) bonds’ investors are expected to reap N160 billion as interest (coupon) payment in two consecutive weeks even as the Debt Management Office (DMO) auctions N145 billion worth of bonds on behalf of the federal government.

Checks revealed that FGN bond investors last week received N142 billion as coupon payment from the federal the government investment instrument and will this week receive another N18.2 billion, hence coupon payment of N160.2 billion in two weeks. Further analysis showed that the N160.2 billion represents 68 percent of the N234 billion investors received as coupon payment in the second quarter (Q2’2020), and 33 percent of the N488.9 billion received in the first quarter (Q1’2020) according to the DMO.

Data from the debt agency showed that investors in FGN bonds received N723 billion as coupon payment in the first half of the year (H1’2020).

The DMO also showed that FGN bond coupon payment constituted 78.5 percent of the N921.9 billion spent by the FG on domestic debt service in H1’2020.

Meanwhile the DMO will this week offer N145 billion worth of FGN bonds to investors during its September monthly auction to be conducted on Wednesday. According to the agency, the bond auction comprises N25 billion worth of 10 years bonds, N40 billion of 15-year bonds, N40 billion worth of 25-year bonds and N40 billion worth of 30 years bonds.

At the last auction conducted in August, the DMO sold N116.65 billion worth of bonds. This was in spite of the N242.23 billion worth of bonds demanded by investors, representing 86 percent oversubscription when compared to the N130 billion worth of bonds auctioned by the DMO.

Also in a bid to further lower FG’s borrowing cost, the DMO slightly reduced the stop rate on the 15-year, 25-year and 30-year bonds by 15 basis points (bpts), five bpts and five bpts respectively to 9.35 percent, 9.75 percent and 9.9 percent in August from 9.5 percent, 9.8 percent and 9.95 percent in July, while the stop rate on the 10-year bond was raised by seven bpts to 6.7 percent from six percent in July.

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.

Finance

Global Deal Activity Down by 4.5% in October 2020

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A total of 6,304 deals were announced globally during October 2020, which is a decrease of 4.5% over the 6,598 deals announced during September, according to GlobalData, a leading data, and analytics company. An analysis of GlobalData’s Financial Deals Database revealed that the deal volume during October remained below the monthly average of Q3 2020.

Aurojyoti Bose, the Lead Analyst at GlobalData, comments: “After demonstrating growth for four consecutive months, the deal volume shrank in October. The decline in deal activity could be attributed to inconsistencies across different regions. The APAC region remained a weak spot, while deal activity remained mostly flat in North America, and the Middle East and Africa (MEA) region witnessed growth in deal activity.”

North America attracted the highest number of investments, followed by APAC, Europe, the MEA, and South, and Central America.

The uncertain global economic landscape lowered the deal volume in October for major markets such as the US, Germany, Australia, France, India, and China compared to the previous month. On the contrary, the UK, Japan, South Korea, and Canada saw growth of 15.6%,14.9%, 3.8%, and 2.2%, respectively, in October as compared to September’s deal volume.

Bose continued: “Most of the deal types witnessed a decline in volume during October compared to the previous month. Private equity, equity offerings, venture financing, debt offerings, and partnership deals volume decreased by a respective 2.4%, 9.1%, 9.8%, 14.6%, and 24.6% – while the deal volume for mergers and acquisitions (M&A) increased by 7.2%.”

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Investment

Japaul to Invest in Chinese Firm H&H to Deepen Mining and Exploration Business

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Japaul Gold & Ventures Plc (Japaul), formerly known as Japaul Oil and Maritime Services Plc, announced it has gotten approval in principle from H&H Mines Limited to invest in or acquire shares in the company once it concluded its fundraising exercise.

According to a statement released through the Nigerian Stock Exchange (NSE), H&H Mines Limited has several licenses, which include two major Mining Leases for 25 years renewable.

The statement noted that extensive exploration has been done on the Mining properties and the last lap of the exploration works is core drilling. This, it said will allow Japaul knows the measured Minerals Reserve contained in the Mine, which it claimed contain Gold, Silver, Lead, Zinc, etc.

Japaul further explained that the need to get the drilling done was what led H&H Mining to engage the services of Xiang Hui International Mining Company Nigeria.

“Since Japaul will eventually be part of H&H Mines Limited, it was necessary that Japaul is carried along on the kind of Contract of Drilling to be entered into, and that was why the signing of the Drilling Contract between the Chinese Company and H&H Mines Limited was concluded at Japaul’s Head Office,” the company stated.

The drilling is expected to be concluded in the next 12 months and within this time, Japaul is expected to have concluded the Fund Raising and formalise her involvement in the Mining.

The company added that Canadian reports revealed that there are huge gold, silver, lead, etc deposits, but it is drilling that will show the actual reserve.

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Africa Investment Forum (AIF) Rescheduled to Hold in 2021 – AfDB

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Investment Forum to Now Hold in 2021 in a Bid to Curb Possible Second Wave of COVID-19  

The Africa Investment Forum scheduled to hold in November 2020 in Johannesburg, South Africa has been rescheduled to hold in2021 as a result of the ongoing global health pandemic.

This announcement was made in a statement by AfDB on Wednesday. The African Development Bank (AfDB) and the Africa Investment Forum founding partners agreed to the postponement of the annual three-day investment market place.

Considering the negative effect of Covid-19 on the global economy, agreement by the two bodies was made after a careful assessment of the impact of COVID-19 on global travels, investments, observing the social distancing rules and curbing the likely possible risk of a second wave.

In the statement, the bank stated that through the forum innovative digital platforms, it would track investments, source for new deals, progress on financial closure of transactions and other existing deals.

“At the 2019 Africa Investment Forum, 57 deals valued at $67.7bn were tabled for discussions. Fifty-two deals worth $40.1bn secured investment interest.

“In July this year, the AIF Founding partners pledged to strengthen strategic partnership engagement and commitments for Africa Investment Forum Market Days 2021, to help ‘reboot investments in Africa.’ They underscored the need to boost local manufacturing while leveraging the continent’s vast resources to unlock investment.”

In the statement, Africa Investment Forum objectives are achieved through the forum’s four pillars; Closing, Connecting, Engaging and Investment Tracking.

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