The Debt Management Office has announced the offering of N150 billion Ijarah Sukuk bonds for subscriptions.
According to a statement released via the DMO website on Tuesday, the bonds were offered at 15.75 per cent per annum and will be due in October 2033.
The statement added that the bonds were offered at N1,000 per unit subject to a minimum subscription of N10,000 and in multiples of N1,000 thereafter.
Subscriptions to the 10-year-tenured bonds started on Tuesday and would close on October 13, 2023.
The statement from the DMO read, “Under the local loans (Registered Stock and Securities) Act, CAP. L17, on the authority of the Federal Government of Nigeria FGN road FGN Road Sukuk Company (FGN RSC 1) offers subscriptions through Greenwich Merchant Bank Limited, Stanbic IBTC Capital Limited, and Vetiva Capital Management Limited are authorized to receive applications for N150bn10-year Ijarah Sukuk due October 2023. Rental rate 15.75 per cent per annum”
The Sukuk is being issued by the FGN Road Sukuk Company on behalf of the Federal Government of Nigeria.
The rental payments are repayable for half a year. However, bullet redemption can be paid on maturity.
The DMO also noted that funds raised from the offer will be used solely for road construction across the six zones in the country.
Since it was introduced in 2017, Sukuk bonds had provided N742.56bn for the Federal Government and had helped in funding the rehabilitation and construction of roads covering 4,000 kilometres across the country.
It was recently reported that the amount paid on rentals for Sukuk bonds rose from N8.17 billion in the first quarter of 2022 to N33.13 billion by the second quarter, showing a 305.51 percent increase.
The amount paid on rentals for Sukuk bonds was N8.17 billion in the first quarter of 2023.