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FG Raises N7b from Savings Bond in 10 Months

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Savings Bond

By Leadership

The federal government has raised a total sum of N7.3 billion in the past 10 months from its savings bond introduced in March 2017 to boost domestic investors’ participation in the bond market.

The government, this year, planned to use the savings bond to finance the budget deficit but investors’ appetite for investment in the savings bond diminished in the fourth quarter of 2017.

The December allotment figure shows that N246.41 million had been raised, which is the lowest savings bond the Debt Management Office (DMO) generated this year over drop in coupon rate.

Analysts attributed the drop in savings bond coupon to improved macro economy.

Managing Director of Highcap Securities Limited, Mr David Adnori said, “The savings bond coupon rate dropped due to improvement in macro economy as interest rate is on decline in the economy. Rates on bonds and Treasury Bills (T-Bills) are all declining”.

The coupon rate allocated were 11.738 per cent for FGNSB DEC 2019, which is a two-year bond and 12.738 per cent for FGNSB DEC 2020, representing a three-year bond.

For November allotment, the figures show that N256 million had been raised through 12.091 per cent (FGNSB NOV 2019) two-year bond and 13.091 per cent (FGNSB NOV 2020) three-year bond.

Subscription in November was the second lowest as investors’ appetite started dropping.

Before November and December, the average coupon rate on FG’s savings bond was pegged at an average 12 per cent to 13 per cent, with a two-year and three -year bonds.

In October, the saving bond allotment dropped by 5.6 per cent to N389.19 million from N412.7 billion, following the slowdown in coupon rates.

The coupon rate assigned to a FGNSB OCT 2019 and FGNSB OCT 2020 in October was at 12.059 per cent and 13.059 per cent respectively, while in September, the coupon rate was at 13.817 per cent (FGNSB SEP 2019) and 14.817 per cent (FGNSB SEP 2020)respectively.

Before the last quarter of 2017, there was increased participation at the debt market in the first quarter as demand for T- Bills, FGN Bonds and the Savings bond increased relative to supply.

Specifically, in March the debt office had raised N2.068 billion from the 13.01 per cent two years debt with 2,575 total number of successful subscriptions.

According to LEADERSHIP findings, data from Debt Management Office (DMO) showed that the initial auction of the savings bond still had the largest participation in the first quarter and started dropping in the second and third quarter.

At the end of first quarter in April, DMO raised N1,288.02 billion that comprises of N419.33million and N868.69 million for a 12.794 per cent and 13.794 per cent, two- year and three-year savings bond respectively.

In May, it raised N791.15 billion with yields rising to 13.189 per cent for the two-year paper and 14.189 per cent for the three-year allotment.

The yield remained the same in June but the amount raised dropped to N607.26 million.

However, an increased yield failed to spike interest in July, as only N400.57 million was raised from the two-year and three-year paper, although the yield for the papers were raised to 13.386 and 14.836 per cents respectively.

By August, investors’ interest in the savings bond increased along with the yield offered.

The two-year bond was offered at 13.535 per cent, while the three-year Savings bond was offered at 14.535 per cent, just as the DMO was able to raise N738.14 million through the Savings Bond.

Analysts maintained that many retail investors traded with caution following the yuletide celebration, while some diverted funds to the equity market, foreign exchange market, as yield on savings bond and T-Bills are not attractive.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

Economy

FrieslandCampina, Afriland Properties Weaken NASD Index by 0.24%

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NASD Unlisted Securities Index

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange fell by 0.24 per cent on Friday, April 25 after the duo of FrieslandCampina Wamco Nigeria Plc and Afriland Properties Plc landed on the losers’ table.

FrieslandCampina Wamco Nigeria Plc depreciated by N2.58 to sell at N35.37 per unit compared with the previous day’s N37.95 per unit, and Afriland Properties Plc lost 2 Kobo to close at N17.78 per share versus Thursday’s closing value of N17.80 per share.

However, Geo-Fluids Plc appreciated by 10 Kobo during the trading day to sell for N1.80 per unit, in contrast to the preceding session’s N1.70 per unit. The rise in the price of the stock could not prevent the fall of the bourse yesterday.

Consequently, the market capitalisation of the trading platform went down by N4.64 billion to N1.914 trillion from N1.918 trillion and the NASD Unlisted Security Index (NSI) declined by 7.92 points to 3,269.06 points from 3,276.98 points.

The final trading session of the week ended with a surge of 1,695.8 per cent in the volume of securities transacted to 3.7 billion units from the 206.2 milion units transacted in the previous trading day.

Equally, the value of transactions jumped by 2,592.6 per cent to N9.5 billion from N354.1 million on Thursday, and the number of deals decreased by 47.4 per cent to 20 deals from the 38 deals recorded a day earlier.

Impresit Bakolori Plc remained the most active stock by volume on a year-to-date basis with 533.9 million units sold for N520.9 million, followed by Geo-Fluids Plc with 259.3 million units worth N456.1 million, and Okitipupa Plc with 153.6 million units valued at N4.9 billion.

Also, Okitipupa Plc remained the most active stock by value on a year-to-date basis with 153.6 million units valued at N4.9 billion, trailed by FrieslandCampina Wamco Nigeria Plc with 15.6 million units worth N598.5 million, and Impresit Bakolori Plc with 533.9 million units sold for N520.9 million.

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Economy

Nigeria’s Stock Market Gives up 0.30% Friday

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stock market how to invest in US stocks in South Africa

By Dipo Olowookere

A 0.30 per cent fall was recorded by the Nigerian Exchange (NGX) Limited on Friday as a result of profit-taking in the industrial goods sector.

This was mainly caused by sell-offs in Dangote Cement Plc, which released its financial statements for the first quarter of 2025 yesterday.

The cement maker lost 10.00 per cent during the session to trade at N432.00, Regency Alliance lost 8.06 per cent to close at 57 Kobo, VFD Group depreciated by 7.57 per cent to N17.10, Chams declined by 7.27 per cent to N2.04, and Sovereign Trust Insurance crashed by 6.12 per cent to 92 Kobo.

Conversely, International Breweries, Legend Internet, and Ikeja Hotel gained 10.00 per cent each to sell for N7.70, N6.82, and N12.10 apiece, Vitafoam Nigeria surged by 9.93 per cent to N44.85, and Eterna rose by 9.92 per cent to N39.90.

The industrial goods index was down by 4.73 per cent on Friday, as the others finished in green territory.

The consumer goods space rose by 2.21 per cent, the banking sector appreciated by 1.55 per cent, the insurance counter expanded by 1.50 per cent, the energy sector increased by 0.07 per cent, and the commodity industry went up by 0.04 per cent.

At the close of transactions, the All-Share Index (ASI) went down by 321.21 points to 105,753.05 points from 106,074.26 points and the market capitalisation shrank by N202 billion to N66.465 trillion from N66.667 trillion.

The level of activity increased yesterday as the trading volume, value, and number of deals grew by 30.40 per cent, 94.23 per cent, and 17.64 per cent, respectively.

This was because investors transacted 428.1 million shares worth N20.2 billion in 14,284 deals compared with the 328.3 million shares valued at N10.4 billion in traded in 12,142 deals a day earlier.

GTCO led the activity chart with 60.7 million equities sold for N3.8 billion, Fidelity Bank traded 41.4 million stocks worth N829.3 million, Access Holdings exchanged 40.6 million shares valued at N968.3 million, MTN Nigeria sold 33.0 million equities for N8.2 billion, and Zenith Bank transacted 22.9 million stocks worth N1.1 billion.

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Economy

Naira Now N1,599/$1 at Official Market, N1,605/$1 at Black Market

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Naira-Yuan Currency Swap Deal

By Adedapo Adesanya

The Naira extended its gains against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, April 25 by 0.22 per cent or N3.59 to sell for N1,599.42/$1 compared with the N1,603.01/$1 it was traded in the previous session.

The Nigerian currency also improved its value against the Euro in the official market by N1.36 to close at N1,818.53/€1 compared with Thursday’s closing price of N1,819.89/€1.

However, the domestic currency depreciated against the Pound Sterling in the same market segment yesterday by N1.90 to wrap the session at N2,130.44/£1 versus the preceding session’s rate of N2,128.50/£1.

At the black market segment, the Naira appreciated against the greenback on Friday by N2 to quote at N1,605/$1, in contrast to the previous day’s value of N1,607/$1.

In the cryptocurrency market, a possible regulatory progress about digital assets in the US spurred buying interest among investors during the trading session.

The chairman of the US Securities and Exchange Commission, Mr Paul Atkins, was at a crypto roundtable on Friday and he devoted his inaugural speech to assuring the industry that he will continue to remake securities policy to favor digital assets innovation.

The agency and industry have been awaiting congressional action to establish crypto market-structure oversight that will likely set guardrails, and Atkins told an audience at the SEC’s Washington headquarters that the regulator will work toward delivering “a rational, fit-for-purpose framework” for crypto.

Litecoin (LTC) rose by 3.0 per cent to $87.24, Dogecoin (DOGE) grew by 2.7 per cent to $0.1862, Bitcoin (BTC) increased by 1.3 per cent to $94,687.84, Ethereum (ETH) jumped by 1.2 per cent to $1,797.51, Cardano (ADA) improved by 0.9 per cent to $0.7235, and Ripple (XRP) gained 0.6 per cent to close at $2.20.

On the flip side, Solana (SOL) depreciated by 0.9 per cent to $151.64, and Binance Coin (BNB) lost 0.8 per cent to sell for $602.89, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.

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