Nigeria Sells N800bn In Sovereign Bonds

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Nigeria auctioned 80 billion naira ($540 million) worth of 20-year, 5-year and 3-year sovereign bonds at its sixth debt auction of the year, the Debt Management Office (DMO) said on Thursday.

The debt office sold 20 billion naira of the 20-year paper, 30 billion naira of the 5-year instrument and 30 billion naira of the 3-year bond at auction on Wednesday.

All the instruments are re-openings of previous issues, the DMO said in a statement.

The DMO said successful bids for the 3-year, 5-year and 20-year offers were allotted at marginal rates of 6.24 percent, 7.61 per cent and 8.69 per cent respectively.

“However, the original coupon rates of 5.50 percent, 4.00 per cent and 8.50 per cent for the 3-year, 5-year and 20-year respectively will be maintained,” the debt office said.

Investors were willing to buy a total of 229.33 billion worth of the papers on offer, but the debt office stuck to its initial offering of 80 billion naira.

Bond traders said the huge interest in the paper was a result of excess liquidity in the system from the injection of May budgetary allocations to the three tiers of government, which was disbursed last week.