Investors Stake N110 Billion on FGN Bonds in January

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CBN office

By Obinna Chima

A total of N110 billion FGN bonds were sold in January, compared to the N76.49 billion recorded in December 2012.

The Financial Market Dealers Association (FMDA) made this known in its monthly financial and economic report for January obtained by THISDAY at the weekend. The amount represented an increase by 43.8 per cent, compared to the preceding month.

“The Bond maturities were re-openings of three previous issues: 15.10 per cent FGN APR 2017 (5 Year original tenor), 16 per cent FGN JUNE 2019 (7 year original tenor) and the 16.39 per cent FGN JAN 2022 (10 year original tenor),” it revealed.

According to FMDA, total public subscription for the three bonds amounted to N223.05 billion in the month under review, as against N143.85 billion the preceding month. This also was the highest level recorded so far.

It added: “The marginal rates of the reopened instruments fell by 100 basis points, 110 basis points and 56 basis points respectively over last month’s as a result of robust liquidity levels following repayment of N150 billion on the maturity of 9.45 per cent JAN 2013 and continued demand by local and foreign institutional investors in the month under review.”

The report also showed that the Federal Accounts Allocation Committee (FAAC) appropriated a total of N567 billion among the three tiers of government for December, which was shared in January, as against N569.46 billion for the month of November that was also shared in December 2012.

“From this amount, the sum of N283.65 billion representing the allocation to states and local governments was posted into the system against N255.22 billion in the previous month reflecting an increase of 11.14 per cent, facilitated by improved proceeds from crude oil sales and non-oil revenue sources,” the FMDA stated.

Also, the report showed that deposit taking and lending rate of deposit money banks (DMBs) inched up slightly in the month under review, compared to the rates reported in the preceding month.

It said: “Savings figures averaged 2.0434 per cent while other tenured funds ranged between 3.5395 per cent – 9.0410 per cent for overnight to 364 days money. For the lending rates, prime structured loan and normal structured loan stood at monthly average of 18.0625 per cent and 22.1876 per cent respectively in January.”