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Nigeria’s Bond Sale Suffers Low Patronage

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By Modupe Gbadeyanka

The sale of bonds by the Nigerian government on Wednesday suffered a setback as investors were not attracted to what is being offered to them.

The Federal Government had planned to sell N95 billion in bonds on Wednesday through the Debt Management Office (DMO), but what it realised fell far below the target.

At the end of the auction, the DMO was only able to sell N39 billion.

According to findings, investors demanded higher yields from Nigeria.

The N39 billion raised from the exercise was from bonds maturing in five, 10 and 20 years’ time.

It was observed that investors were asking for yields as high as 18 percent for the notes, way above the mid-point at which the DMO had wanted to issue them.

The auction results showed that the DMO sold N5 billion of 2021 debt at 15.48 percent, while it realised N20 billion from the 2036 debt at 15.94 percent and N14 billion from the 2026 debt at 15.98 percent.

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Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

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