Series I Domestic dollar-dominated Bond has been introduced by the Nigerian government with the objective of raising a minimum of $500 million from both local and international investors.
As per a recent Auction circular, the government is eyeing $1 billion in subscriptions for this particular auction.
Notably, this auction coincides with the period when five of Nigeria’s Eurobonds have been listed among the poorest performers in the Bloomberg index of emerging and frontier sovereign debt.
A detailed breakdown of the bond program indicates a total size of up to $2.0 billion, which can be increased at the issuer’s discretion.
The bond carries a five-year tenure, offering investors a medium-term investment avenue for steady returns.
Furthermore, it has been highlighted that the bond’s coupon rate is pegged to comparable FGN Eurobonds yields, ensuring competitive returns that are in line with international market standards.
Interest payments will be made semi-annually, allowing investors to receive regular income and increasing the attractiveness of the bond.
The bond features bullet repayment at maturity in US dollars, guaranteeing full repayment of the principal amount at the conclusion of the five-year period.
It is worth mentioning that two weeks ago, Wale Edun, the Minister of Finance, had mentioned the intention to introduce the $500 million in domestic foreign currency-denominated bonds.