Nigeria’s 3rd Eurobond issue over-subscribed despite economic crisis

Minister of Finance, Kemi Adeosun
Minister of Finance, Kemi Adeosun

In spite of the gloom on the country’s economy, investor confidence in Nigeria remains high as the $1 billion Eurobond issued by the federal government on Thursday was over-subscribed by almost eight times.

The over-subscription was with orders in excess of $7.8 billion compared to a pre-issuance target of $1 billion.

The bond, issued under Nigeria’s newly established Global Medium Term Note programme, is the third in the series after the ones in 2011 and 2013.

The note has February 16, 2032 as maturity date for repayment on the principal, and is expected to yield interest at a rate of 7.88 percent.

The Federal Ministry of Finance said proceeds from the bond would be used to fund capital expenditures in the 2017 budget.

The government said the offering attracted significant interest from leading global institutional investors.

The notes would be admitted to the official list of the UK Listing Authority and available to trade on the London Stock Exchange’s regulated market.

“Nigeria will apply for the Notes to be eligible for trading and listed on the Nigerian FMDQ OTC Securities Exchange and the Nigerian Stock Exchange,” finance ministry said in statement.

The pricing for the bond was determined during a roadshow to promote the issuence of the bond.

The roadshow was led by the minister of Finance, Kemi Adeosun; accompanied by her counterpart in the Ministry of Budget and National Planning, Udo Udoma; Central Bank of Nigeria governor, Godwin Emefiele; and Director-General of the Debt Management Office (DMO), Abraham Nwankwo, as well as the Director General of the Budget Office, Ben Akabueze.

“Nigeria is implementing an ambitious economic reform agenda designed to deliver long-term sustainable growth and reduce reliance on oil and gas revenues while reducing waste and improving the efficiency of government expenditure, ” Mrs. Adeosun said of the bond.

“At the heart of the agenda is a commitment to invest in developing Nigeria’s infrastructure through a target 30 per cent annual budget commitment to capital expenditure.

“We are establishing the building blocks for long-term growth and making the hard decisions that must be made to reset our economy appropriately.”

Commenting on the Notes’ pricing, the DMO Director General, Abraham Nwankwo, said:

“Nigeria is delighted to have successfully priced its third Eurobond issue. We have successfully extended the tenor of our borrowing programme in the international capital markets to 15 years, at a price that reflects belief in the quality of Nigeria’s cash flows and government.

He said the Eurobond is the latest step in a broader debt strategy designed to significantly re-balance our debt profile towards longer term financing and reduce the burden of interest on our annual budget.


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  • The Revolutionaries

    Premium Times Editor,

    Why euro bonds alone cannot save Nigeria

    The past General Manager of NNPC, Mr. Yakubu, criminally stashed away
    or hid away 10 million dollars in his bedroom until he was caught with it
    three days ago. No other country exhibits such psychiatric theft reflex.
    Where the Judges are part of the theft racket, and take bribes from
    those who loot the treasury, there are no courts of law anymore.
    All there is perhaps is a conspiracy of thieves in partnership.
    Only a bloody revolution can save Nigeria from total collapse.
    The treasury thieves and the rubber-stamping Judges alike
    must be laid to rest in perfect peace after revolutionary
    justice is dealt to them on the streets with viciousness.
    Let he who has no gun sell his cloth to buy one now.
    As it is, only a bloody revolution can save Nigeria.

    • kinsly

      What are you waiting for na? Internet noise maker. Start the revolution or close that your smelling mouth.

      • The Revolutionaries

        @disqus_5qrTly6DBt:disqus,

        Some things are not given to you to know. Nigeria is already in the middle of a revolution.

        In any country where the law is sold by Judges; and, well-organized armed militias rampage,

        a revolution has long started, and only thing left now is to calibrate the struggles for purpose.

        • breakin’ news

          “Gunmen in the early hours of Friday attacked a police station at Eika
          community in Okehi Local Government Area of Kogi, killing two policemen
          and a detainee. The News Agency of Nigeria ( NAN) gathered that the bandits
          invaded the police station at about 1 a.m. and opened fire on policemen on duty,
          killing them, alongside a detainee.”

          • ::????????

            WHO WILL SAVE NIGERIA? THAT’S THE QUESTION. WHO WILL RISE AND SAVE NIGERIA?

            THE COUNTRY IS GASPING. NIGERIA IS DYING. BUHARI HAS NO SOLUTION. SAVE NIGERIA!

  • forestgee

    At 7.8% (in a clime where benchmark rate is about 0.5%) and probably with a lien on CBN offshore deposits, over-subscription by investors should be expected!

    • Bash

      Which clime are you talking about…is Nigeria in Europe or North America. You probably belong among those who thought no one will subscribe to the bond in the 1st place and now you are disappointed!

      • Dele Awogbeoba

        These people are lending dollars and are receiving 7.8% interest on a dollar loan. Dollar loans in the west attracts very very low interest. The high 7.8% interest they are receiving reflects the high risk associated with Nigeria’s debt and its junk bond status having been rated B+ by Fitch. Class A investment entities are precluded from lending to sub investment entities so they would not partake in such a lending.

        • Bash

          I agree. But still far from the initial projection that no lender or investor will put
          money in Nigeria. Of course we are a risky destination and I expect ‘forestgee’
          to know that and the high interest rates being the premium to pay. On the hand
          as well Nigeria has no chance of attracting the class A investments but have a
          choice of taking what’s available to drive the development agenda or sit back
          and lament. Also in a situation where the nay sayers and their collaborators have
          decided to ‘match their legs on the pipe’ of the major income source for the country,
          the administration is left with little other chance of mobilizing capital for its
          development agenda. It’s a risk we should take, in my view. In any case for the
          Administration it is the case of whatever they do they are damn.

    • Pastor J.J.Jones

      “A corrupt tree cannot bring forth good fruit. For out of the heart proceed evil thoughts, murders,

      adulteries, fornication, thefts, false witness, and, blasphemies. The love of money is the root

      of all evil; which, while some coveted after, they erred from faith and pierced themselves

      with sorrows. Brethren, you shall not steal. Theft entails deceit; and in a heart where the spirit

      of deceit is, there, the spirit of God cannot be”.

      • forestgee

        …yes out of evil heart proceed rising inflation and unemployment, collapsing foreign exchange rate, killings by Herdsmen…etc

  • No-Comment

    God told me that the president – BUHARI –
    has done well but his time is up, Aso Rock is vacant, nobody is there. And God
    told me that he will raise up a man who loves Nigeria to take over. It’s not
    going to be business as usual, God is taking over this country, what happened
    in America is going to happen in Nigeria. New Nigeria will be born. Most of
    those people who stole our wealth, God told me that they will be exposed
    wherever they are. What God revealed to me is that enemies of this country,
    enemies that are always putting wrong people there to punish us… God said
    he has put a lion there, on the seat of the leader of this country, nobody is
    sitting there. And anybody that doesn’t love this country, that they want to go
    all out to fix people there, God will consume them.”

    …………….Primate Theophilus Olabayo

    (Evangelical Church of Yahweh Worldwide)

    [February 10th, 2017]

    • G. Global Inc.

      @forestgee:disqus

      All said and done Premium Times is the only institution left behind President Muhamadu Buhari.
      Everybody else has fled from what looks like an imminent disaster coming straight at the nation.
      President Buhari has come to the end of his tether and has nothing novel or original to offer.
      Muhamadu Buhari seeks to do what is convenient for him, despite his mortgaging tomorrow.

  • Bash

    Where is Emir Sanusi who said no investor will put money in Nigeria because of government policies ? In fact where are the nay sayers who took delight in abusing Madam Kemi and Emiefele? Where are the wailing wailers who see nothing good in the government? Of course we will hear new excuses…. and why this will still not work.

    • Höly Wähala

      Shut up dia and stop spreading lies due to your incomprehension of simple economic models presented by Emir Sanusi with his lecture. He was talking about banks lending Nigeria $30bn which is quite different from Nigeria raising funds through other means like this Eurobond issue. Here Nigeria is promising a return of 7.5% while IMF, World Bank, AfDB etc, loans come with as low as 0-3% interest rates which is why you see over-subscription of the 7.5% yielding bonds. It’s a risk worth taking given the enabling circumstances at the moment viz: higher oil prices and stable production environment (spoken, Avengers contained) with OPEC’s productions ceilings exemption of Nigeria. Now, do you see why it makes sense to those investors? Their only requirement is for Buhari to allow the markets sink the value of the naira v. dollar to N380/$ which is something no Nigerian official on the roadshow was able to guarantee because obviously, President Buhari has his hands in the monetary policy functions of the CBN… end of lecture!

      • Adekunle

        Meshionu there…..Olodo rabata

        What’s the tenure of IMF & World bank loans? For your information this Eurobond will expire in 2032 which is a long time enough for Nigeria to make judicious use of the loan to repay itself. Coupled with the millin of dollars recovered from your drunken master and Hero, Nigeria is n the sure part to greatness. Now I know you and your Biafrats are not happy, you can do us a favor by jumping into the Lagoon before Oba Akiolu comes for you.

        Buhari is taking Nigeria to the promised land and it’s either you join the train or we crush you with it. Shikena

        • Höly Wähala

          Look at your stripped, dirty Yoro mouth talking trash beyond your little Jakande education. Not every mosquito on my wall is worth swatting so, go and take a shower, your lot is notorious for poor personal hygiene. Nkapia!

    • Julius

      You meed to realize that they do not like good news ! Had it been that it failed, you would have been reading them celebrating. It is what it is. Nigeria will move forward without them. Congrats. more good news to come.

    • Alcindo Satori

      This is no good news, we were just rated B negative, meaning the probability of a default is almost 1, this move has failed already before it began, don’t rejoice over nothing.Nigeria is currently one of the worst places to any investor to go due to all the bad policies this govt has tried and failed.

  • RAPE on The Niger DELTA

    Dear AVENGERS,
    There is massive poverty in the Niger Delta. There is nothing to show for the wealth of the region as monies from the region are used to develop Abuja and the rest of the country. The only benefit the oil producing and resource owners – Biafra and Niger Delta regions benefit from Nigeria are :
    – Pollution
    – Neglect
    – Violence
    – Military Occupation
    – Wanton arrest of its citizens
    – Harassment
    – Sponsored propaganda to defame
    – Bypass in political appointments
    – Hate, hate and more hate
    – Etc etc, etc

    SECESSION is the only way for the Niger Delta and Biafran regions if they must achieve their potentials. Buhari can remain president of the rest of Nigeria and those of us who do not want to be associated with Nigeria in any way should be left alone to live our dreams and fly to our destination – have our own country. And this is what we must do.

    May God be with our freedom fighting comrades – the AVENGERS…and we look forward to the prayer sessions of Operation Hurricane Joshua and Jericho Wall which you have proposed

  • Econometrist

    @forestgee:disqus

    NIGERIA CAN’T BE HARNESSED BY DEBT. That is where this Buhari regime lost its way.
    Euro bond is debt, regardless that it is oversubscribed for being offered at a premium,
    such that idle investors’ funds in Europe and North America will get higher interest.
    There’s nothing to cheer in Nigeria putting its neck on a debt slab, no prizes for it.
    Debts hobble growth and make the future as blank as the present dire situation.

    • Solomon Ghandi

      It’s true. No economic theory can work in Nigeria. There’s total
      disorder. Total anarchy, stealing everywhere, killings everywhere, government
      officials are stealing every day, Judges in the courts are taking bribes too. The
      youths have bought guns. They kill at will. They attack Police station and kill
      all Policemen on duty. They attack courthouses and beat the hell out of the
      court Judges and slap court clerks into a coma. How can euro bonds help in that
      kind of animal existence in Nigeria where there’s even no electricity?

      • Deera

        “In Nigeria, the pauperized many have sent a memo to the criminally-rich few: ‘We will not allow
        you to enjoy your ill-gotten gains in peace. We will hound you and pursue you everywhere you go.
        When you buy your Hummers, we will snatch them. When you send your children to expensive
        schools, we will kidnap them. When you retreat to your billion-naira homes, you will have to sleep
        with one eye open. With every knock, you will panic and tremble, fearing it could be nemesis
        at the door”.

        ………Femi Aribisala

        [August 27th, 2013]

    • augustine


      ⛔All prominent local and international economists, past CBN governors, past presidents who spoke on the state of Nigeria’s economy today, ALL agreed that debt, borrowing, capital gearing, loans, is the ONLY WAY OUT of recession and near collapse caused by fantastic, fantabulous and fantasmagoric treasury looting of 2008-2014.

      ⛔⛔Else, to avoid debt or loans, kindly ask your heroes whom you love, to return our ~ $100 billion looted by last PDP government

  • musa aliyu

    Who said we’re in any recession? Mtchewww! When the stack $ in their houses just waiting r Baba to die so that they can continue their nefarious agenda of enslaving us?

  • Otile

    God forbid evil. This frog-looking woman called Kemi is corrupt. What are these economic charlatans celebrating? What this woman and her Ponzi schemers are calling Nigeria’s 3rd Eurobond is nothing but junk bonds. This is the case of Caveat Emptor(let the buyer beware). Another way to describe Kemi’s junk bond is what they call high flying bonds. There is nothing to celebrate here because the reason her junk bond carries the obscene rate of 7.8% while IMF carries 0.3% is the high risk associated with junk bonds of this nature. The default rate can be staggering. Nigeria depends on oil alone, and in the eventuality of break up, or Avengers taking back what belongs to them Kemi and her voodoo economic cabal will default. In all Nigeria has nothing to celebrate about her Ponzi scheme.

    • Fems

      Why don’t you stick to what you know and leave this for economist to say.

      Meanwhile this was your hero in 2013 when oil was $100/barrel celebrating a bond a similar $1billion dollar bond that was only 4times over subscibed

      Nigeria comfortably raised $1 billion in its return to the Eurobond market on
      Tuesday, taking advantage of a short period of relative calm in
      otherwise turbulent markets to issue both a long and shorter-dated bond.

      Theissue was four times oversubscribed, with just over $4 billion in bids,
      a source told underscoring still buoyant investor appetite for scarce
      frontier African paper, despite a recent selloff in emerging market
      assets.

      “We’re very happy that at this time, when the markets are exhibiting turbulence, we were able to
      (achieve) … four times oversubscription,” Finance Minister Ngozi
      Okonjo-Iweala told a journalists’ conference call after the issue.

      “The coupon shows confidence in the Nigerian economy,” she said, adding that the money would be spent on infrastructure.
      Africa’s top oil producer issued a $500 million 5-year bond at a yield of 5.375
      percent and a $500 million 10-year bond with a yield of 6.625 percent, according to IFR, a Thomson Reuters news and analysis service.
      The 5-year paper received bids of $1.77 billion and the 10-year of $2.26 billion, the source said.

      By
      comparison, Nigeria’s debut $500 million 10-year Eurobond, which it
      issued in 2011, received bids worth two and a half times the amount on
      offer.

      The yield on the 10-year bond is less than the 7 percent the West African
      country paid in 2011, but higher than what it could have paid if it had
      issued just a few months ago, analysts said.

      “We saw a window of opportunity … appetite for our paper was strong,” Okonjo Iweala s

  • Al

    OPPOSITIONS & black belle over to you

  • Lanre

    Nigerians and their loud mouths. Look at the illiterates on here (Musa Aliyu, etc). So what is $1b in the international financial market? And as someone just noted the rate at 7.8% is over 7 times what investors are getting in europe with negative interest rates. The budget of New York City is $82b. Loud mouthed retards!