By Modupe Gbadeyanka
On Monday, June 3, 2019, federal government commenced the issuance of the second tranche of its green bond programme to investors.
In the series II of the exercise, N15 billion worth of the papers were offered for sale with a tenor of seven years at 14.40 to 14.50 percent per annum.
A circular released by the Debt Management Office (DMO), which is coordinating the auction, said subscription would close on Monday, June 10, 2019, with the settlement date fixed for Wednesday, June 13, 2019.
Business Post reports that financial advisers/issuing houses for the sale are Chapel Hill Denham Advisory Limited, Capital Assets Limited, Rand Merchant Bank Nigeria Limited and Stanbic IBTC Capital Limited.
Investors willing to subscribe to the green bond would have to purchase at N1,000 per unit, subject to a minimum Subscription of N10 million and in multiples of N1 million thereafter.
The green bond qualifies as securities in which trustees can invest under the Trustee Investment Act. It also qualifies as government securities within the meaning of the Company Income Tax Act (CITA) and Personal Income Tax Act (PITA) for Tax Exemption for Pension Funds, amongst other investors.
The bond is tradable on both the Nigerian Stock Exchange (NSE) and FMDQ OTC Securities Exchange and is backed by the full faith and credit of the Federal Government of Nigeria.
The DMO said proceeds from the exercise will be used solely for green projects as identified by the Inter-Ministerial Committee on Climate Change, approved in the 2018 Appropriation Act, and assessed by Moody’s Investors Service.
Adedapo Adesanya