The Federal Government raised a total of N55bn from the debt market in July, it was learnt on Thursday.

This amount represents an increase of 34.19 per cent or 164 per cent over  N20.81bn borrowed by the regulatory authority in the month of June.

This information was contained in the July edition of the Monthly Financial and Economic Report of the Financial Markets Dealers Association released on Thursday.

“The regulatory authority in the debt market raised N55bn relative to N20.81bn borrowed in the preceding month, reflecting a significant increase of 164.30 per cent,” the report said.

An analysis of the report also shows that this amount represents a decline of 8.91 per cent or 11 per cent over N83.91bn borrowed by the regulatory authority in the month of June.

The amount represents a decrease of 27 per cent when compared to N75bn raised from the debt market in July 2012.

The report noted that in the month under consideration, two securities which had reached maturity, were reopened.

The securities are the 4.00 per cent FGN APR 2015 (five-year original tenor) and the 10.00 per cent FGN JUL 2030 (20 year original tenor).

It added that the total public subscription in the month for the two bonds amounted to N135.93bn as against N157.04bn for the three bonds issued the previous month.

The report said, “The successful bids that ranged from 12.00 per cent to 16.50 per cent for the instruments were allotted at the stop rates of 13.45 per cent and 13.79 per cent for four per cent FGN APR 2015 and 10 per cent FGN JUL 2030 securities, respectively.

“The marginal rates of both securities increased compared to June’s figure, to reflect prevailing price at the Over-the-Counter market, as yields stabilised relatively above 13 per cent levels following improvement in local investors’ sentiment market self-correction dynamics as well as gradual re-entry by offshore institutional investors.”

It explained that the bonds market deals for the month fell slightly by 4.63 per cent compared to last month’s which increased by 29.04 per cent, while the volume/face value fell by 27.91per cent as against 22.82 per cent increase recorded in June 2013.

The report said, “The highest traded and priced bond was the 16.39 per cent FGN JAN 2022 while the lowest traded was the 9.35 per cent FGN NOV 2017, and the 8.50 per cent FGN NOV 2029 was recorded as the lowest priced bond.”

“At the two-way quote bonds market, activities were further concentrated at the short and intermediate end of the yield curve with relative improvement in investors’ sentiment for longer tenured bonds as witnessed within the last two weeks of the month,” it added.

Source: Punch (by Udeme Ekwere)