Economy
Nigeria’s Total Public Debt Jumps to N38.0trn in Q3 2021
By Aduragbemi Omiyale
The total public debt of Nigeria increased quarter-on-quarter by 7.2 per cent or N2.540 trillion to N38.005 trillion in the third quarter of 2021 from N35.565 trillion in the second quarter of this year.
This information was revealed by the Debt Management Office (DMO) in a statement released on Tuesday night.
The agency explained that the amount comprises the debts incurred by the federal and state governments from both external and internal sources.
In Dollar terms, the debt office stated that the total debt of the nation stood at $92.626 billion at the end of Q3 2021 compared with $86.678 billion it was at the end of Q2 2021.
According to the DMO, the increase in the debt was a result of the $4.0 billion Eurobond issued by the federal government in September following the approval of the National Assembly.
The exercise attracted investors from Europe, America as well as Asia and the paper was issued in tranches of three tenors: $1.25 billion for seven years at a yield of 6.125 per cent, a 12-year bond at 7.375 per cent worth $1.5 billion, and a 30-year tranche of $1.25 billion sold at 8.25 per cent.
The Eurobond was part of the government’s plan to raise $5.71 billion in external financing to help fund spending in 2021 and to partly finance the N5.6 trillion deficit.
The DMO had initially wanted to sell $3 billion worth of the note, but because of the strong appetite of investors, it increased the bond offer by $1 billion.
This action consequently raised Nigeria’s total public debt to N38.005 trillion amid harsh criticisms over the penchant of President Muhammadu Buhari administration for borrowing.
But the debt office in the statement issued today said, “The issuance of the $4 billion Eurobonds has brought significant benefits to the economy by increasing the level of Nigeria’s external reserves, thereby supporting the Naira exchange rate and providing the necessary capital to enable the federal government finance various projects in the budget.
“The triple tranche $4 billion Eurobond, issued in September 2021, was for the implementation of the new external borrowing of $6.18 billion in the 2021 Appropriation Act.”
By Aduragbemi Omiyale
The implementation of a fully electronic registration process for capital market operators has been commenced by the Securities and Exchange Commission (SEC).
This is deployed through the regulator’s ePortal. It allows Capital Market Operators (CMOs) to complete designated registration processes online, covering application submission, regulatory review, approvals and communication of decisions, thereby eliminating manual processing for the services included in the current phase.
It was stated that the implementation is being carried out in phases to ensure a smooth transition for market participants while maintaining the stability and integrity of regulatory processes.
This system enables designated regulatory services to be completed entirely online as part of efforts to modernise Nigeria’s capital market and improve regulatory efficiency.
The current phase is limited to post-registration services for existing Capital Market Operators, as applications for the registration of new entrants into the Nigerian capital market are not yet covered.
According to the SEC, the commencement of electronic processing for new registration applications will be announced at a later date.
The commission stated that the commencement of this policy marks another milestone in its digital transformation agenda and its drive to build a technology-driven regulatory environment.
This initiative is expected to simplify regulatory interactions, reduce administrative bottlenecks, shorten processing timelines and provide applicants with greater visibility into the status of their applications.
It will also improve operational efficiency while strengthening regulatory oversight through standardised workflows, electronic documentation, secure digital record management and enhanced audit trails.
The SEC explained that the e-registration platform aligns with its strategic objective of leveraging technology to improve market efficiency, enhance the ease of doing business and deliver better services to stakeholders.
According to the regulator, beyond improving efficiency, the platform will enhance the integrity of regulatory processes by reducing delays associated with paper-based documentation and improving the quality of regulatory data for decision-making.
It noted that the digital platform would also provide a stronger foundation for regulatory analytics and future innovations aimed at improving oversight of Nigeria’s capital market.
“The new platform represents a major step towards creating a seamless digital regulatory ecosystem that enhances operational efficiency while strengthening regulatory effectiveness,” the agency said in a statement on Wednesday, urging operators to familiarise themselves with the new platform and comply with implementation timelines to ensure a seamless transition to the electronic registration process.
By Adedapo Adesanya
Dangote Petroleum Refinery has formally approached Nigeria’s Securities and Exchange Commission (SEC) to begin the regulatory process for its planned initial public offering (IPO), paving the way for what could become Africa’s largest stock market listing, according to a report by BusinessDay.
The newspaper reported that the refinery’s advisers are already working with company officials and the SEC to process the application, with the regulator expressing confidence that there are no obstacles likely to delay the transaction.
Speaking in an interview with BusinessDay, the Director-General of the SEC, Mr Emomotimi Agama, said the commission stands ready to address any issues that may arise during the approval process.
“If any issue arises, SEC will resolve it. That is why the SEC exists,” Mr Agama was quoted to have said.
Although no official listing date has been approved, the refinery is still targeting a September debut on the Nigerian Exchange (NGX) Limited. There are also plans for a multi-African bourse listing.
The planned IPO is expected to rank among the largest equity offerings ever seen in Africa and would mark one of the most significant additions to Nigeria’s capital market in recent years.
The listing also aligns with ongoing efforts by regulators to encourage major privately owned companies to go public and deepen the country’s equity market.
The application comes after several months of preparatory engagements involving Dangote Refinery, its advisers and the SEC.
Mr Agama noted that the company’s early engagement with the regulator has helped streamline the approval process, adding that the commission intends to encourage similar collaboration for future listings.
Meanwhile, the SEC has concluded investigations into the unauthorised promotion of the refinery’s proposed IPO by some market participants before regulatory approval had been obtained.
According to Mr Agama, sanctions are being imposed on those found to have breached the rules, although he declined to identify the affected entities.
This comes after the company raised about $2.5 billion has been raised by from its private equity placement.
The exercise attracted broad participation from international and African institutional investors, sovereign-related investment vehicles, development finance institutions, strategic partners, and individual investors.
Notable participants included the Africa Finance Corporation (AFC) and India Infra Buildco, an investment vehicle facilitated by the African Export-Import Bank (Afreximbank), reflecting deep and diversified confidence in DPRP’s long-term prospects.
The transaction is believed to be Africa’s largest publicly disclosed primary equity private placement, marking a significant milestone in the history of the organisation and demonstrating strong investor confidence in the refinery’s long-term growth strategy, including raising its current capacity from 700,000 barrels per day to 1.4 million barrels per day.
By Adedapo Adesanya
The trio of MRS Oil Plc, Central Securities Clearing System (CSCS) Plc, and Afriland Properties Plc lifted the NASD Over-the-Counter (OTC) Securities Exchange by 1.21 per cent on Wednesday, July 29.
MRS Oil made a N14.80 gain to close at N162.80 per share versus the previous session’s N148.00 per share, CSCS Plc appreciated by N5.09 to N95.00 per unit from N89.91 per unit, and Afriland Properties Plc improved by 73 Kobo to end at N20.63 per share, in contrast to Tuesday’s closing price of N19.90 per share.
As a result, the NASD Security Index (NSI) added 51.73 points to settle at 4,324.88 points compared with the preceding day’s 4,273.15 points, and the market capitalisation jumped by N31.03 billion to close at N2.595 trillion versus N2.564 trillion.
At the close of transactions, the volume of securities exchanged by the market participants fell by 96.8 per cent to 213,893 units from 6.7 million units, the value of securities declined by 82.7 per cent to N14.8 million from the preceding session’s N85.8 million, and the number of deals slumped by 13.7 per cent to 44 deals from the previous day’s 51 deals.
Great Nigeria Insurance (GNI) Plc was the most traded stock by value on a year-to-date basis, with 3.4 billion units sold for N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units traded for N6.5 billion, and CSCS Plc with 75.9 million units transacted for N5.4 billion.
GNI Plc also closed the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units valued at N6.5 billion, and Resourcery Plc with 1.1 billion units exchanged for N415.7 million.
