Investors overshoot FG Bonds by 140bn

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Federal Government of Nigeria to auction 100bn Bonds on March 27

Federal government bonds put out for subscription on March 27 was oversubscribed in excess of 140bn by investors.

This was revealed by the Debt Management Office (DMO) in a statement released on Wednesday.

The DMO statement read: “The FGN Bond auction for March 2019 conducted on Wednesday at which N100bn bonds were offered was oversubscribed just as in the auctions for January and February.

“We offered three instruments at the auction for three, seven and 10-year tenors and subscriptions for the three instruments was in excess of N148bn for competitive bids. Non-competitive bids valued at N92.6bn were also received, taking the total subscriptions across the three tenors to over N240.6bn.”

It added that “The trend of investors’ preference for the longer tenured instrument continued, with the 10-year bond significantly oversubscribed with a bid-to-cover ratio above five.”

“Allotments were made to successful bidders at the rates of 13.5 per cent for the five-year, 13.5 per cent for the seven-year and 13.5 per cent for the 10-year bonds, which are considerably lower than the allotment rates for the February 2019 auction.”

Total amount allotted to both competitive and non-competitive bids for the three, seven and 10-year tenors was N121.95bn, the DMO statement confirmed.