The federal government has appointed Transaction Advisers for a $6.2 billion Eurobond Issuance set for part-funding of its estimated N5.2 trillion deficit in the 2021 Budget.

According to the Debt management Office (DMO), the Federal Executive Council (FEC), at its meeting on Wednesday, yesterday, approved the advisory services.

They advisors are: JP Morgan, Citigroup Global Markets Limited, Standard Chartered Bank and Goldman Sachs would act as International Bookrunners/Joint Lead Managers; while Chapel Hill Denham Advisory Services Ltd would act as Nigerian Bookrunner.

FSDH Merchant Bank Ltd was named Financial Adviser; White & Case LLP as International Legal Adviser ; and Banwo & Ighodalo, as Nigerian Legal Adviser.

The DMO said that the Transaction Advisers emerged from an open competitive bidding process as outlined in the Public Procurement Act, 2007 (as amended).

It said that a total of 38 institutions responded to the Expression of Interest, and after rigorous evaluation to ascertain the technical capacities of the responders to execute the Transaction, the eight institutions above were selected.

With the approval of the Transaction Advisers, the DMO said it would now accelerate activities towards the Issuance of the Eurobonds.

It explained, “Whilst the Government expects a successful outing, it will be mindful of costs and risks (in terms of tenor and pricing) in determining the amount of Eurobonds to issue.

“Since the Eurobonds are being issued to part finance the 2021 Budget Deficit, the proceeds will be used to fund various projects in the Budget. In addition, the proceeds will result in an inflow of foreign exchange which in turn, will increase Nigeria’s External Reserves and support the Naira Exchange Rate.”

boxypane:
Of what effect will this still have on the economy? All of the expenditures in the last fiscal year amounted increased insecurity and food prices.

saintol:
By the time these people are done with this country, everything would have burnt beyond recognition.

PataAlhajaKeji:


What do you know about eurobonds, investments and the economy?

You think we are talking Bet9ja or baba ijebu here.

Nonsense.

PataAlhajaKeji:


1. More dollar inflows into the economy which will invariably shoot up our external FOREX reserves.

2. More funds to execute infrastructural development projects.

3. Increase in the value of the Naira.

... and trust me, the bonds will be fully subscribed as soon as it is issued. Foreign investors are not in doubt of Nigeria's debt capacity and financial viability.

boxypane:

Invariable it should increase our GDP right?
We thus also need to consider leakages of which bulk is corruption. If we can control the menace, I think we are good.
More so, what is the worth of the brand called NIGERIA now in view of the current security challenges.

PataAlhajaKeji:


1. More dollar inflows into the economy which will invariably shoot up our external FOREX reserves.

2. More funds to execute infrastructural development projects.

3. Increase in the value of the Naira.

... and trust me, the bonds will be fully subscribed as soon as it is issued. Foreign investors are not in doubt of Nigeria's debt capacity and financial viability.

PataAlhajaKeji:


It will definitely increase our GDP in the long run via the funding of infrastructural development.

Corruption is endemic in Nigeria. It will forever be with us. There's definitely gonna be illicit contract price inflation ... but the good thing about Buhari is that he has been delivering on infrastructure.

Nigeria's worth in the global community is very high. Na we no value ourselves. Africa's biggest economy and most populated.

The last Eurobond issuance was fully subscribed by international investment companies within a few days.

plaetton:

Absolute trash.
A bond is debt, a high interest debt, a costly mortgage on a future.

" He goes a borrowing who goes a sorrowing" .

The idea of using debt to shore up foreign reserves is a fools errand. Who exactly are we supposed to impress by shoring up our foreign reserves with high interest debt ?
Foreign reserves are supposed to showcase our productivity and foreign currency earnings capability, not our borrowing addiction.

The more debt we carry, the more of our future earnings we use to service such debts. The deleterious chain reactional effect of carrying expensive debts, especially for a fantastically corrupt and unproductive generator economy should be obvious to even a 10yr old.

PataAlhajaKeji:


1. More dollar inflows into the economy which will invariably shoot up our external FOREX reserves.

2. More funds to execute infrastructural development projects.

3. Increase in the value of the Naira.

... and trust me, the bonds will be fully subscribed as soon as it is issued. Foreign investors are not in doubt of Nigeria's debt capacity and financial viability.

They advisors are: JP Morgan, Citigroup Global Markets Limited, Standard Chartered Bank and Goldman Sachs would act as International Bookrunners/Joint Lead Managers

plaetton:

Absolute trash.
A bond is debt, a high interest debt, a costly mortgage on a future.

" He goes a borrowing who goes a sorrowing" .

The idea of using debt to shore up foreign reserves is a fools errand. Who exactly are we supposed to impress by shoring up our foreign reserves with high interest debt ?
Foreign reserves are supposed to showcase our productivity and foreign currency earnings capability, not our borrowing addiction.

The more debt we carry, the more of our future earnings we use to service such debts. The deleterious chain reactional effect of carrying expensive debts, especially for a fantastically corrupt and unproductive generator economy should be obvious to even a 10yr old.