Sukuk Bonds Record N652bn Oversubscription

The October 2023 sukuk bonds offered by the Federal Government garnered over a subscription of N652 billion, translating to 435 per cent of (N150 billion) offered.

The Debt Management Office (DMO) who confirmed the development on Friday said the N150 billion Sovereign Sukuk bond offer closed on October 11, 2023.

The high level of subscription affirms the high level of awareness and investors’ confidence in the Sukuk bond instrument, and their willingness to support the federal government’s option of Sukuk as a tool for financing key infrastructure, DMO explained in a statement issued on Friday.

In response to investors’ appetite and strong demand for the Sukuk, DMO allocated N350 billion to the diverse investors who subscribed to the Sukuk bond.

Giving insights into the utilization of sukuk proceeds, the Debt Agency said the N350 billion will be used to finance the construction and rehabilitation of roads and bridges across the six geopolitical zones and the Federal Capital Territory.

It pledged a commitment to meeting the needs of investors and supporting the development of the domestic capital market.

DMO started issuing a sovereign sukuk in 2017 with a maiden issuance of N100 billion in September.

From the Sukuk issued between 2017 and 2021, a total of N612.56 billion was raised and deployed to the construction and rehabilitation of sections of 71 roads and 4 bridges covering a total of 2,820.06km.

To deepen the Sukuk bond instrument, DMO facilitated it on the Nigerian Exchange Group (NGX) and the FMDQ Securities Exchange. It was opened for subscription in November 2022 with an initial offer of N100 billion.

The subscription garnered immense interest from investors with a remarkable subscription level of N165. 25 billion which represents over 165% of the amount offered.