With an outstanding obligation of N19.24 trillion at the domestic bond market as at December 2021, the federal government through the Debt Management Office (DMO), has raised another N1.614 trillion this year. Data from the DMO showed that the N1.614 trillion was raised through both the FGN bonds as well as the FGN Savings bond. The amount raised so far this year was 13.8 per cent more than N1.418 trillion which it raised in the same period of 2021.
Total FGN Bonds obligations as at December last year stood at N13.963 trillion representing 72.56 per cent of N19.242 trillion domestic debt as at December 2021. Nigerian Treasury Bills accounted for 19.68 per cent of the total bonds obligation with N3.786 trillion, while government Promissory Notes at N762.54 billion was 3.96 per cent.
FGN Sukuk Bond obligation accounted for 3.18 per cent of the debt stock of the government at N612.557 billion while Nigerian Treasury Bonds with N75.988 billion accounted for 0.39 per cent of the total domestic debt stock. The Green Bond’s share of the debt stock was 0.13 per cent at N25.69 billion while the FGN Savings Bond was just 0.09 per cent of the debt stock at N16.42 billion.
LEADERSHIP findings showed that between January and May this year, the government through the DMO had raised N1.61 trillion with its FGN Bonds compared to N1.415 trillion which it raised in the comparable period of 2021.
Last year, the DMO had raised N2.712 trillion for the government through the FGN Bonds, as against N1.87 trillion which it raised in 2020.
It also raised N4.47 billion through the FGN Savings Bond between January and April this year compared to N3.33 billion which it raised in the comparable period of 2021.
Last year, the total amount raised from the Savings Bond stood at N8.39 billion which is a significant increase compared to N3.63 billion raised in 2020. The Savings Bond auction did not hold for three months in 2020 due to the Covid-19 lockdown.
This year, the highest amount raised at the Savings Bond auction was in March when N2.15 billion had been raised. In April, investors’ interest had waned as N1.13 billion had been raised through the bond designed specifically for retail investors.
For the FGN Bonds, the highest amount had been raised in February where N415.42 billion had been raised. This month, total subscriptions on the three bonds auctioned stood at N575.63 billion although only N378.41 billion had been allocated or raised through non-competitive bids.
A total of N88.92billion had been raised through the 13.53 per cent FGN MAR 2025 paper at 10 per cent, while N171 billion was raised through the 13.00% FGN JAN 2042 paper at 13 per cent. a total of N85.34 billion had been allotted while N33.15 billion came from non-competitive bids through the 12.50 per cent FGN APR 2032 paper.
At the secondary bond market, the bulls dominated the Treasury bonds market as the average yield across instruments declined by 10bps to 11.2 per cent. Analysts attributed the bullish sentiment to investors covering for lost bids at the FGN bond auction which was held last week Monday.
Across the benchmark curve, the average yield contracted at the short (-2bps) and mid (-27bps) segments as investors sold off the MAR-2027 (-17bps) and NOV-2029 (-34bps) bonds, respectively; but expanded at the long (+2bps) end following investors’ profit-taking activities on the APR-2037 (+27bps) bond.