The value of Federal Government bonds listed in the Nigerian capital market hit N3.54tn at the end of year 2011.

This information was contained in a document posted on the website of the Nigerian Stock Exchange on Monday.

The amount, which represented the total sum borrowed by the FGN to finance various projects, was issued from 2003, with maturity dates of up to year 2030.

According to the document, five of the bonds valued at N456bn will mature by the end of this year, while nine bonds will mature in 2013, with a total value of N902.66bn.

Further analysis also showed that four of the bonds, valued at N480bn, would mature in 2014. Another bond, valued at N500bn, will mature in 2015.

Two FGN bonds, with a value of N120bn, have a maturity date of 2017; another, valued at N280.24bn, will mature in N2018; while one, valued at N160bn, will mature in 2019.

According to the document, another separate bond valued at N75bn, will mature in 2028, while two bonds valued at N350bn, will mature in 2029.

It added that the last bond, with a value of N217.3bn, would mature in 2030.

Meanwhile, reports obtained by our correspondent late last year had shown that nine state governments received approval to raise N217bn bonds from the capital market in the last one year.

According to the report, the states received this approval following their applications to relevant authorities to raise funds from the market, mainly for developmental purposes.

Investigations by our correspondent had revealed that most state governments had been approaching the Nigerian capital market to raise bonds to further boost development in their states as a result of the inadequate allocations they receive.

The statement obtained from the website of the Securities and Exchange Commission showed that these nine states received approval between April 30, 2010 and June 30, 2011.

For instance, the Lagos State Government, which was the first to receive approval within this period, is offering for subscription N57.5bn 10 per cent fixed rate under the N275bn debt issuance programme, for the 2010/2017 (Series 2).

The state is leading the pack in terms of volume and value and has so far raised N50bn in 2008 and N57.5bn in 2010, totalling N107.5bn raised in its first and second bonds issues in 2008 and 2010, respectively.

Also, Bayelsa State received an approval to raise N50bn from the capital market in June 30, 2010. The state issued an offer for subscription of N50bn 15.5 per cent Fixed Rate Development Bond between 2010/2017.

The Edo State 14 per cent six-year tenor fixed rate infrastructure development bond received approval on December 31, 2010, and was admitted on July 21, 2011.

Ebonyi State, on its part, has issued an offer for subscription of N20bn at 14 per cent Fixed Rate Bonds between 2010/2015. The cost of the issue was put at 3.14 per cent of the gross proceeds plus 1.88 per cent underwriting fee. The application was approved on September 24, 2010.

Benue State Government also received approval by May 26, 2011, to raise N13bn at a 14 per cent Fixed Rate Development Bond between 2010 and 2015, while Kaduna State’s offer for subscription of N10bn at 14.5 per cent Fixed Rate bond under the N20bn debt issuance programme (Series 1) of between 2010 and 2015 was also approved on August 31, 2010.

According to the SEC document, the Imo and Kwara governments have also received approvals to raise bonds worth N18.5bn and N17bn from the capital market.

Specifically, Imo State issued an offer for subscription of N18.5bn at15.5 per cent Fixed Rate Bonds under its N40bn Debt Issuance Programme (Series 1).This offer is between 2009/2016.

Kwara, on its part, sought to raise an offer for subscription of N17bn at 14 per cent Fixed Rate Bond, under its N30bn Debt Issuance Programme, between 2009 and 2015 (Series 1).

Niger State has also received approval for its offer for subscription of N6bn at 14 per cent Fixed Rate Redeemable Infrastructure Development Bond representing (series 1) of between 2009 and 2014.

The incoming of Rivers State’s N250bn bond is expected to shoot up the bond issues, when the NSE admits the state’s bonds to be auctioned in two tranches of N100bn and N150bn.

Source: Punch/Udeme Ekwere