The Debt Management Office (DMO) on Wednesday reported that its July 2023 Federal Government of Nigeria (FGN) bond offering received overwhelming investor interest, surpassing all expectations with an oversubscription rate of 182.73 percent.

The DMO, responsible for managing the nation’s debt, reopened the market for two 10-year, one 15-year, and one 30-year FGN bonds, collectively valued at N657.84 billion.

The July 2023 offering also recorded a month-on-month increase of 39.03 percent, equivalent to N184.68 billion when compared to the N473.16 billion sold in June 2023.

This was revealed in the FMDQ Exchange financial markets monthly report for July, which was released on Wednesday.

The oversubscribed FGN bond offering in July, combined with the impressive performance in the treasury bills market, where the DMO sold bills valued at N406.10 billion, underscores Nigeria’s fiscal strength.

During the month under review, the Central Bank of Nigeria did not conduct any public OMO bills auctions within the period under review.

The average FGN bond coupon rates in July 2023 dipped across 10-year, 15-year and 30-year segments to 13.05 percent, 14.10 percent and 14.30 percent respectively.

It was also reported that there were no corporate bonds listed on FMDQ Exchange in July 2023 compared to N17.50bn worth of corporate bonds listed in June 2023.

Saudi Arabia has completed an early purchase of more than 35.7 billion riyals ($9.5 billion) of outstanding debt and will issue about 35.9 billion riyals in sukuk as the kingdom plans to bolster its domestic market.

The government bought a portion of its debt instruments maturing in 2024, 2025 and 2026, the National Debt Management Center said in a statement on Sunday.

The buyback represents the largest early purchase transaction arranged by NDMC.

The Saudi government will issue new sukuk worth 35.9 billion riyals under the Local Saudi Sukuk Issuance Program, NDMC said. The program will be divided into four tranches, with issuances maturing in 2031, 2032, 2033 and 2038.

The initiative is part of NDMC’s efforts to strengthen the domestic market and “to keep up with market developments which have been reflected positively on the growing trading volume in the secondary market,” the agency said.

The transaction will also align NDMC’s efforts with other initiatives to enhance public finances in the medium and long term. HSBC Saudi Arabia, Al Rajhi Capital, SNB Capital, and AlJazira Capital have been appointed as joint lead managers to lead the transaction.

For the Development Bank of Nigeria‘s first bond issue, Prominent development investment banking institution, DLM Capital served as both the principal issuing house and the financial consultant.

Through one of its subsidiaries DLM Advisory, the DLM Capital Group has constructed and provided advice on Nigeria’s first development bond, which was issued by the Development Bank of Nigeria.

The Series 1 ₦23 billion, 14.40% 5-Year Bond under a N100 billion Medium Term Note Programme registered with the Securities and Exchange Commission was designed to make sustainable capital available to Micro, Small, and Medium-Scale Enterprises (MSMEs). On July 13, 2023, the first batch of bonds were issued.

Dr. Tony Okpanachi, the managing director and chief executive officer of the bank, commented on the bond issuance and emphasized that DBN’s main goal as an institution is to reduce the financial constraints faced by MSMEs and small businesses in Nigeria by providing financing and partial credit guarantees to qualified financial intermediaries on a market-conforming and fully financially sustainable basis.

Mr. Nwabu Okonkwo, Vice President, Investment Banking at DLM Advisory Limited, said in a statement that the bond offering was favorably accepted by the market and attracted participation from a wide variety of investors, including domestic pension funds, asset managers, and insurance companies.

The Bank had planned to raise ₦20 billion, but overall subscriptions totaled ₦25.37 billion, or 1.26 times more than that amount. With eligible bids totaling ₦23 billion, the Series 1 Bond was offered at a clearing coupon of 14.40%.

DLM Capital Group GCEO, Mr. Babatunde Sonnie Ayere, commented on the transaction in a statement, saying, “DLM Capital Group is proud to have led this historic transaction which marks the debut bond by the Development Bank of Nigeria, reflecting the strong credit quality of the issuer as well as the resilience of the Nigerian Capital markets, despite the current global market volatility.”

With Standard Chartered Capital & Advisory Nigeria Limited serving as the Joint Issuing House, Agusto & Co., Deloitte & Touche, KPMG, Meristem Registrars & Probate Services Ltd., Zenith Bank Plc, Access Bank Plc, and First City Monument Bank are additional parties. Olaniwun Ajayi LP, G. Elias & Co., DLM Trust Company, ARM Trustees, GCR Ratings, and others are also involved.