Low-interest payment drove Nigerian corporates in 2020, to raise a record level of N1.114 trillion debt from the capital market, data obtained from the Securities and Exchange Commission (SEC) and FMDQ, has shown.
SEC data showed Corporate debt issuances (bonds + CPs) rose from N671 billion in 2019 to N1.14 trillion last year.
This comprises debt raised via short-term commercial papers and long-term corporate bonds excluding private placements.
Commercial papers accounted for the most with a total of N746 billion raised last year as opposed to N509 billion and N399 billion in 2019 and 2018 respectively.
Corporate bonds issuance also surged with companies issuing N368 billion in 2020, up from N163 billion and N187 billion in 2019 and 2018 respectively.
Average Corporate bond yield at issue dropped by 6.1 percentage points to 9.5 percent last year, from the high of 15.6 percent in 2019.
Similarly, the average CP discount rate at issue dropped by over 6 percentage points to 6 percent in 2020 from 12.6 percent in 2019.
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