Nigeria's leading finance and market intelligence news report.

FG bonds suffer low patronage on coronavirus scare

...DMO reports just 39 successful bids, yield spike

Local bonds issued by the Nigerian government on Wednesday recorded low patronage as investor sentiment dampened on the ravaging coronavirus pandemic which has already infected some 487,000 persons globally with 22,000 deaths.

The Debt Management Office said it offered N50bn, 5-Year, 10-Year, and 30-Year tenored bonds to investors at the auction held on Wednesday for March 2020.

* indicates required

A total of 164 bids were received while only 39 were successful. In February 428 bids were reported with 101 successful.

As seen in the DMO report released on Thursday, 29 bids were received for the 5-year; 61 for 10-year; and 74 for 30- year bonds from investors who placed N21.07bn; N69.01bn and N91.18bn subscriptions across the three instruments, respectively.

But only 7 bids were successful for the 5-year; 18 for the 10-year; and 14 for the 10-Year bonds.

Consequently, N70bn bids were allotted as against N160bn reported for last month’s auction and N411.822bn in January.

N5bn was allotted for the 5-year bond; N20n for the 10-year and N25bn for the 30-year bonds for the competitive bids.

In addition, the sum of N10bn was allotted through Non-Competitive Bid for the 5- year bond and another N10bn for the 10-year bond. None was allotted for the 30-year bond.

Consequently, bids were allotted at the rate of 10% for the 5-Year; 12.5% for the 10-Year; and 12.98% for the 30-Year Bonds.

This indicates a significant jump from the 8.75%, 10.7%, and 12.15% rates obtained in February for the three tenors, respectively.

 

Comments are closed.