FG Lists N75bn 25-year Bond On NSE

The Federal Government has listed its long-term N75 billion bond on the Nigerian Stock Exchange (NSE), paving the way for bondholders and investors to trade on the debt securities.

The N75 billion bond was issued on July 24, 2020 with a maturity date of July 24, 2045, representing a tenor of 25 years. It carries a coupon of 9.8 per cent yearly, payable twice in a year, January 24 and July 24 every year.

A total of 75 million units of the 9.80 per cent, 25-year bond were admitted to the official list of the Exchange at a price of N1,000, the book value price for the issuance.

With the interest benchmark Monetary Policy Rate (MPR) at 12.50 per cent, and rising double-digit inflation, the coupon implies negative return for bondholders.

Many analysts believe that declining yields on government securities, where most pension fund managers have more than two thirds of their funds, may adversely affect the performance of the pension funds in the period ahead.

They argued that the value of pension assets will depreciate in real terms, when adjusted for cost of capital and inflation.