FG sells N80bn in sovereign bonds

Friday, 25 Jun 2010   


The Federal Government auctioned N80bn worth of 20-year, five-year and three-year sovereign bonds at its sixth debt auction of the year.


The Debt Management Office said on Thursday that it sold N20bn of the 20-year paper, N30bn of the five-year instrument and N30bn of the three-year bond at the auction on Wednesday.All the instruments were re-openings of previous issues, the DMO said in a statement.


The DMO said successful bids for the three-year, five-year and 20-year offers were allotted at marginal rates of 6.24 per cent, 7.61 per cent and 8.69 per cent respectively.”However, the original coupon rates of 5.50 per cent, four per cent and 8.50 per cent for the three-year and 20-year respectively will be maintained,” the debt office said.


Investors were willing to buy a total of 229.33 billion worth of the papers on offer, but the debt office stuck to its initial offering of N80bn.Bond traders said the huge interest in the paper was a result of excess liquidity in the system from the injection of May budgetary allocations to the three tiers of government, which was disbursed last week.






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