https://www.bloomberg.com/news/articles/2017-11-20/nigeria-set-to-issue-3-billion-of-eurobonds-in-biggest-sale-yet

Nigeria Raises $3 Billion in Its Biggest Eurobond Sale Yet

By Paul Wallace

20 November 2017, 16:38 GMT

Updated on 21 November 2017, 14:02 GMT

Nation sold 10-year notes at 6.5%, 30-year bonds at 7.625%

Issue received orders of about $11 billion: central bank
Nigeria raised $3 billion in a two-part international bond sale as it seeks to fund a fiscal deficit and reduce its local-currency debt burden.

The West African nation split the offering equally between 10- and 30-year tranches. The yield was 6.5 percent for the shorter notes and 7.625 percent for the 30-year portion, down 25 basis points on each tranche from the initial guidance. The issue received $11 billion of bids, according to central bank Governor Godwin Emefiele.

The offering, its biggest Eurobond issuance ever, is the nation’s third sale this year. While Africa’s biggest oil producer is still reeling from its worst economic slump in about 25 years, Nigeria has benefited from strong demand for emerging-market assets and Brent crude’s 30 percent rise since the end of June to more than $62 per barrel.


Most of the new debt will fund Nigeria’s 2017 budget, with the rest used to refinance maturing local-currency bonds, according to the government.


The yield on the 30-year bond was 25 basis points lower than its 15-year deal sold in February. The rate on those -- the nation’s longest bonds until now -- fell four basis points to 6.69 percent as of 1:58 p.m. in London on Tuesday.

“Extending our debt profile in the international market to 30 years establishes a basis for the longer term financing required for transformational infrastructure investment,” Finance Minister Kemi Adeosun said in a statement on the Debt Management Office’s website.

Egypt, Morocco and South Africa are the only other African nations to have sold 30-year dollar bonds. Before now, the most Nigeria had issued in one day was $1.5 billion.

Citigroup Inc. and Standard Chartered Plc managed the transaction. They arranged meetings in London and New York last week between investors and Nigerian officials including Adeosun and Emefiele.

— With assistance by David Malingha Doya

cc: dominique, MrKnowitall, Mynd44.

One question- what is Euro bond?

Someone pls explain this thing

Can someone explain this euro bond thing in simpler terms. Wetin e mean sef??
Or are we out of recession?

Issokay

how this one take concern me




when the leaders are so corrupt expect nothing less

Buhari is a monumental error of gargantuan proportions and a curse.
Borrowing despite:

- stories of recovered loot
- removal of fuel subsidies
- stamp duty for bank transactions
- rising oil prices

Recession instead of prosperity.
We are in trouble.
2019 is too far oh.

Not what we planned for but its where we've found ourselves as a nation.. we need to understand the current state of our once illustrious Economy.. A storm is coming no doubt but its how we weather that storm that would determine our very existence as a nation come the next decade. if one of the proactive measures the federal government seeks to take is to raise funds through the sale of euro-bonds then emphasis should be placed on which sectors of the economy needs immediate strengthening in the most efficient manner.

More debt

Some are saying nice, some are saying big big grammer"Monumental error".... Which one do i go for now

Glorified ponzi scheme

7.625%?

Still low by sub saharan standards but this is a gamble on our future loan credibility.

Rates are this high because we cant get more than a B rating (fitch). What happens in 20 years, if our risk rating improves drastically?

We would have dashed out free money. The 10 year bonds are a nice bargain though.

The question now is what do they want to do with this money?

I hope we use it well..and it doesn't find itself into our politicians pockets

Economists in the house, kindly break it down.

Sold to who exactly? a case of selling the bonds to the offshore / shell companies that the government officials own.

How does this affect the common man

considering the recent National scale and analysis u will understand and give a deep thought into this matter, u will have no option than to agree that the issue is similar to what might have happened or occurred or even a resemblance of something that will definitely elude a mere human prowess and finally come to the conclusion that I have nothing to say

tobtap:
More debt

Equals more suffering, now and later.
2019, where art thou?

MaryBenn:
One question- what is Euro bond?

Thought am the only confused one here

yeyerolling:
How does this affect the common man

More squeezing, suffering and gnashing of teeth for the common man, now and later.
2019 should be tomorrow please.

Emac34:
how this one take concern me

when the leaders are so corrupt expect nothing less

You mean that Buhari and APC are corrupt
Adonbelieveit

If you have no idea how this post, can reduce the price of garri, like if not get-out.

GavelSlam:
https://www.bloomberg.com/news/articles/2017-11-20/nigeria-set-to-issue-3-billion-of-eurobonds-in-biggest-sale-yet

Nigeria Raises $3 Billion in Its Biggest Eurobond Sale Yet

By Paul Wallace

20 November 2017, 16:38 GMT

Updated on 21 November 2017, 14:02 GMT

Nation sold 10-year notes at 6.5%, 30-year bonds at 7.625%

Issue received orders of about $11 billion: central bank
Nigeria raised $3 billion in a two-part international bond sale as it seeks to fund a fiscal deficit and reduce its local-currency debt burden.

The West African nation split the offering equally between 10- and 30-year tranches. The yield was 6.5 percent for the shorter notes and 7.625 percent for the 30-year portion, down 25 basis points on each tranche from the initial guidance. The issue received $11 billion of bids, according to central bank Governor Godwin Emefiele.

The offering, its biggest Eurobond issuance ever, is the nation’s third sale this year. While Africa’s biggest oil producer is still reeling from its worst economic slump in about 25 years, Nigeria has benefited from strong demand for emerging-market assets and Brent crude’s 30 percent rise since the end of June to more than $62 per barrel.


Most of the new debt will fund Nigeria’s 2017 budget, with the rest used to refinance maturing local-currency bonds, according to the government.


The yield on the 30-year bond was 25 basis points lower than its 15-year deal sold in February. The rate on those -- the nation’s longest bonds until now -- fell four basis points to 6.69 percent as of 1:58 p.m. in London on Tuesday.

“Extending our debt profile in the international market to 30 years establishes a basis for the longer term financing required for transformational infrastructure investment,” Finance Minister Kemi Adeosun said in a statement on the Debt Management Office’s website.

Egypt, Morocco and South Africa are the only other African nations to have sold 30-year dollar bonds. Before now, the most Nigeria had issued in one day was $1.5 billion.

Citigroup Inc. and Standard Chartered Plc managed the transaction. They arranged meetings in London and New York last week between investors and Nigerian officials including Adeosun and Emefiele.

— With assistance by David Malingha Doya

cc: dominique, MrKnowitall, Mynd44.

even buhari dont know what this news is all about

I can see the logic behind locking in debt for long term investments, but if we are borrowing in November to finance 2017 budget, what's the plan to finance 2018 budget which is higher than the 2017 budget?

Government organisations tend to try to spend all money allocated before the year runs out to avoid a cut in the following years budget, hence how can we be sure there will not be reckless spending to make sure they spend the money by the end of the year?

Bond is just a certificate that's backed by law issued out to subscribers (to who are lending the money to government) at a particular rate.
Here FG is the debtor while the subscribers are creditor

Edit: what I described below was actually a foreign bond. Similar to an Eurobond but slight difference the Eurobond is issued in a currency other than the currency of the country’s issuing it, so in this case Nigeria actually issued the bond in dollars.

A Foreign bonds on the other hands is a bond issued inan international market and in that markets currency. The name refers to the currency e.g. Yankee bonds are bonds raised in dollars and listed in the US, Samurai bonds are bonds raised in Yen and listed in Japan, etc.

A simplistic example, Nigeria issues a bond of $100 at 10% for 30 years means Nigeria will pay $10 annually in interest to the bond holder and at year 30 return the principal of $100.

MaryBenn:
One question- what is Euro bond?

Someone pls explain this thing

We no understand ooo

This will make returns on Treasury Bills investment to crash.

All dis na just English.....

Reading

emmanuelewumi:
This will make returns on Treasury Bills investment to crash.

I wonder why someone will buy 10year bond at 6.5% while 1 year T.B is at 18%. Economist in the house please explain. Is it not the same risk?

Bond