Amid COVID-19, Subscribers Sustain Strong Appetite at April FGN Bond Auction

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  • Overall subscription put at 459%

By Ndubuisi Francis  

As has been the trend this year, investors again demonstrated a strong appetite for the FGN bond at the April auction which was conducted on Wednesday, despite the huge impact of COVID-19 on socio-economic activities.

Since January, the FGN Bond auction had been  consistently oversubscribed by investors.

The Debt Management Office  (DMO) offered N60 billion bonds across three  tenors to investors at the April auction, including  N20 billion each for the five-year, 15-year and 30-year tenors. 

The total subscriptions received through competitive bids for the three instruments was N275.67 billion, indicating an overall subscription level of 459 per cent.

The DMO reported that demand was very strong for all the instruments offered at the auction, adding that a breakdown of the subscriptions shows that the sum of N49.70 billion or 248.50 per cent  per cent  was received for the five-year bond; N107.47 billion or 537.35 per cent  for the 15-year bond and N118.50 billion or 592.25 per cent for the 30-year bond.  

Successful bids were allotted at the rate of 9 per cent  for the five-year, 12 per cent  for the 15-year and 12.50 per cent for the 30-year bond, all of which are lower than the rates at the March 2020 FGN Bond Auction.

The total amount allotted for competitive bids was N156.06 billion across the three tenors, while the sum of N20 billion was allotted through non-competitive bids for the five-year and 15-year tenors, which brought the total amount allotted from competitive and non-competitive bids to N176.06 billion.