Nigerian govt May bonds auction fails to meet target, records shortfall of N19.55bn

May 25, 2018

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There are indications that the short-term bonds of the Federal Government are no longer attractive as its five-year and seven-year tenor bonds in May were poorly subscribed, a recent auction result by the Debt Management Office (DMO) has shown.
The result revealed that the federal government raised a total sum of N50.45 billion from the auction which was lower than the N70 billion it targeted to raise.
The N19.55 billion shortfall was greatly influenced by the N3.50 billion allotment from the N20 billion offered at 12.75 percent for the five-year bond and N8.45 billion allotment from the N20 billion offered at 13.53 percent for the seven-year bond.
However, the ten-year tenor bond was oversubscribed with N38.50 billion allotment from the N30 billion offered at 13.98 percent.
The DMO added that N14.99 billion of the 13.53 percent for March 2025 and N14.99 billion of the 13.98 percent for February 2028 were allotted on a non-competitive basis.
In all, the debt agency said it recorded a total of 101 bids, of which 62 were successful, adding that the auction drew subscriptions of N89.82 billion.
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