The Debt Management Office (DMO), has announced that Nigeria raised $2.2 billion through its Eurobond auction.
This is Nigeria’s first Eurobond sale since March 2022.
DMO announced the successful issuance of the Eurobonds in a statement on Monday.
It noted that the bonds attracted a wide range of investors from multiple jurisdictions including the United Kingdom, North America, Europe, Asia, Middle East as well as Nigerian investors.
It also informed that the latest offer the proceeds of which will go into financing the 2024 budget deficit, saw the issuance of two bonds with varying tenors.
It was reported that while Nigeria recorded a total subscription of over $9 billion, only $2.2 billion was allotted.
The allotments are $700 million for the 6.5-year bond priced at 9.625 per cent and a larger $1.5 billion for the 10-year bond priced at 10.375 per cent.
According to the stayement, “This oversubscription reflects an expression of continued investor confidence in Nigeria’s sound macro-economic policy framework and prudent fiscal and monetary management.
“The transaction attracted a peak orderbook of more than $9 billion. This underscores the strong support for the transaction across geography and investor class. With respect to investor class, demand came from a combination of Fund Managers, Insurance and Pension Funds, Hedge Funds, Banks and other financial institutions.”
Minister of Finance Minister and Coordinating Minister of the Economy, Mr. Olawale Edun, in the statement, emphasized the confidence in President Bola Tinubu’s administration’s efforts to stabilize the Nigerian economy and promote sustainable growth.
He noted the strong investor interest in the Eurobonds as a sign of increasing confidence in Nigeria’s economic direction.
The Governor of the Central Bank of Nigeria, Mr. Olayemi Cardoso, highlighted the positive outcome as a reflection of investor confidence and Nigeria’s improved liquidity and market access.
On her part, the Director-General of DMO, Patience Oniha, expressed joy at what she called the landmark achievement, citing strong investor demand (4.18x the offer size) and the competitive pricing of the new 6.5-year and 10-year Notes, which were set at 9.625 per cent and 10.375 per cent, respectively.
The DMO also reaffirmed its commitment to transparency and continued engagement with investors.
Nigeria faces a $1.1 billion Eurobond maturity in November 2025, this probably explains the urgency to return to the international debt market which it last patronised in March 2022 with a decision to focus on domestic debt market. The government took the decision to check the country’s debt servicing cost given the existing debt burden.