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Nigerian govt to float second N100bn Sukuk Bond in December

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Nigerian govt to float second N100bn Sukuk Bond in December

The Director-General of the Debt Management Office (DMO), , said the Federal Government would float the second tranche of N100 billion Sukuk Bond in December.

Sukuk Bond, also known as Islamic Bond, is a financial instrument structured to generate returns without interest payments.

Addressing journalists on Thursday, Oniha said the DMO had put in right measures to ensure the successful issuance of the bond before the end of the year.

“June was when the budget was approved and Sukuk is a project that was also approved in the budget. We will float it; we have made significant progress; we will issue it this year,’’ she said.

Speaking further, the DMO boss added that, just like the first tranche of N100 billion, proceeds from the second tranche would also be channelled into the construction of roads across the country.

Oniha pointed out that the plan to float the second tranche later this year followed the successful outcome of the first tranche, noting that the second tranche of N100 billion would be oversubscribed like the first one based on feelers the office got from investors and the public.

She added that the debt office was working with the Ministry of Power, Works and Housing on the projects earmarked for the second tranche of the Sukuk bond.

“Don’t forget we are selling good products when we do Treasury Bills and FGN Bonds. But in terms of Sukuk, I think from the feelers we got from investors and the public, it is a product the people want to associate with,’’ the DMO boss said.

Read also: Nigeria’s inflation rises for second consecutive month in September

In September 2017, the Federal Government had issued a seven-year first Sukuk Bond of N100 billion as part of capital raising for the construction of about 25 roads in the nation.

Some of the constructed roads include Kolo-Otuoke-Bayelsa-Palm Road, Enugu-Port/Harcourt Road, Kaduna Eastern By-Pass, Ibadan-Ilorin Road, Kano-Maiduguri Road and Loko-Oweto Bridge over River Benue, among others.

 

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