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From Uche Usim, (Abuja) and Chinwendu Obienyi
The Federal Government, through the Debt Management Office (DMO), yesterday, listed the N162.557 billion, 7-year, FGN Ijarah Sukuk with a rental rate of 11.20 per cent on the floor of the Nigerian Exchange (NGX) Limited. The third Sovereign Sukuk which was issued on June 16, 2020, will finance the rehabilitation and construction of key economic road projects across the six geopolitical zones in the country. With this listing, members of the general public who invested in the 2020 Sukuk bonds can now sell their investments and those who wish to invest in Sukuk can also do so.
Speaking on the listing of the third Sovereign Sukuk, Director-General, DMO, Ms. Patience Oniha, said that the DMO was excited that the trading of the Sukuk was now permissible having fulfilled the condition for listing stipulated by the Financial Regulatory Advisory Council of Experts (FRACE) of the Central Bank of Nigeria (CBN).
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“The FGN Sukuk may only be listed for trading on relevant exchanges after the commencement of works on the road project for the construction of the Sukuk assets. This is in order to create a pool of assets consisting of non-financial and financial assets that could be freely traded while avoiding the prohibition of dealing in interest-based transactions arising out of sale of debt and exchange of currency not at par”, she said.
In a statement, the NGX Limited, said the third Sovereign Sukuk on the bourse will provide an exit opportunity for existing investors and further deepen the Nigerian capital market, particularly, the relatively nascent Sukuk market. According to the statement, the issuance and subsequent listing of the Sovereign Sukuk on the NGX underscores the Federal Government’s drive for the development of critical infrastructure needed to unlock economic growth, by leveraging innovative and cost-effective financing structures. “The Exchange continues to deliver on its commitment to provide a platform for issuers and investors to meet their investment objectives. By enhancing access to the Federal Government and the private sector, NGX has promoted and supported the growth of the debt market in Nigeria with listings worth over N2.6 trillion in 2020”, the NGX said.
