By Modupe Gbadeyanka
On Wednesday, November 16, 2016, the Federal Government, through the Debt Management Office (DMO), will auction N95 billion using the Dutch auction system.
In a circular posted on DMO’s website, analysed by Business Post, it was explained that Nigeria will sell N35 billion of a bond maturing in 2036, another N25 billion maturing in 2026 and N35 billion of debt maturing in 2021.
It was also stated that the auction date for sale of the bonds is November 16, 2016, while the settlement date is November 18, 2016.
Business Post further learnt that the bonds would be sold at N1,000 per unit subject to a minimum subscription of N10,000 and in multiples of N1,000 thereafter.
On the interest rate, the DMO noted that for re-openings of previously issued bonds, where the coupon is already set, successful bidders will pay a price corresponding to the yield-to-maturity bid that clears the volume being auctioned, plus any accrued interest on the instrument.
The interest payment, the office explained, would be paid semi-annually.
Interested investors have been advised to contact offices of any of the following Primary Dealer Market Makers (PDMMs) Access Bank Plc, First Bank of Nigeria Ltd, Standard Chartered Bank Nigeria Ltd, Citibank Nigeria Ltd, First City Monument Bank Plc and United Bank for Africa Plc.
Others are Coronation Merchant Bank Ltd, FSDH Merchant Bank Ltd, Zenith Bank Plc, Ecobank Nigeria Ltd, Guaranty Trust Bank Plc, FBN Merchant Bank Ltd and Stanbic IBTC Bank Plc.
Results of the auction, Business Post gathered, are expected to be released on the following day.
Nigeria is planning to borrow about N900 billion locally to finance part of the N2.2 trillion deficit in the 2016 budget.
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