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HomeTop NewsNigeria raises N130 bln in Islamic Sukuk bonds at 15.6% rental fee

Nigeria raises N130 bln in Islamic Sukuk bonds at 15.6% rental fee

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By Samuel Bankole

Nigeria’s Debt Management Office (DMO) on Monday said it has successfully raised N130 billion in 10-year Sovereign Al ’Ijarah Sukuk, N30 billion more than it initially proposed to raise.

In a statement, the debt office said subscription from diverse investors was over the initial offer by 165 percent.

The Islamic Sukuk bonds, which was first issued in the country for the purpose of building infrastructure on September 26, 2017, were issued on Monday at a rental rate of 15.64 percent per annum.

In a statement, the debt office said; “The Debt Management Office (DMO) is pleased to inform the public of the successful conclusion of the Issuance of N100 Billion Sovereign Al ’Ijarah Sukuk.

“The Offer for N100 Billion opened on November 21, 2022, and was supported by wide public sensitization to encourage subscription from diverse investors, particularly the retail investors.

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“The initial Offer size of N100 billion was upsized to 130 billion due to the over 165 percent Subscription level. The Sukuk was issued at a Rental Rate of 15.64 percent per annum. This brings the total Sovereign Sukuk Issuance to N742.557 billion as at date.

“The level of subscription is evidence of investors’ confidence in the use and impact of Sukuk in the construction and rehabilitation of road infrastructure across the country.

“The proceeds of the 2022 Sovereign Sukuk, like the previous Sukuk Issue Proceeds, will be used solely for the construction and rehabilitation of key road projects through the Federal Ministry of Works and Housing and the Federal Capital Territory Administration.

“The DMO appreciates all the investors (Retail Investors, Banks, Pension Fund Administrators, Assets/Fund Managers, Insurances Companies, Ethical Funds, Takaful Operators/Non-Interest Banks, Stockbrokers, Government Agencies, High Net Worth Individuals, Trustees and Unit Trusts) who have continued to support the Federal Government’s infrastructure development efforts through Sukuk financing.

“The strong participation of retail investors, ethical funds and non-interest financial institutions in this Sukuk Offering, attest to the fact that the Government’s objective of promoting financial inclusion through admitting more retail investors and ethical funds into the financial system is being achieved.

“The DMO on its part, will work to sustain the laudable achievements recorded so far in the use of Sukuk Issue Proceeds for the construction and rehabilitation of Nigerian roads, and thereby, continue to enhance ease of commuting and doing business, safety on our roads, job creation, economic growth, and prosperity of our nation.”

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