Nigeria’s $500m domestic bond issuance oversubscribed despite IMF’s warning – Wale Edun
Nigeria’s Finance Minister and Coordinating Minister of the Economy, Wale Edun, has revealed that the International Monetary Fund (IMF) warned against issuing the $500 million domestic bond but it turned out to be a success.
On August 15, 2024, the Federal Government launched the dollar-denominated domestic bond for subscription at a 9.75% per annum interest rate.
The $500 million bond commenced subscription at $1,000 per unit to interested investors five days later.
The auction for the bond, which is set to mature in 2029, closed on August 30, 2024.
One month later, Edun announced that over $900 million was raised from its first-ever domestic dollar-denominated bond issuance, amounting to over 180% subscription.
Edun reveals IMF’s advice on bond
Speaking during an investors’ meeting in Washington DC, the United States, on Wednesday, the minister said the capital raised showed increasing investors’ confidence in Nigeria’s economic stability and growth prospects.
He told the investors that the domestic dollar-denominated bond was over 100% subscribed, which dispelled the IMF prediction on the bond.
“The IMF said to us that we shouldn’t do domestic issues of dollar bonds. We did it and we were 100% oversubscribed, but we still value their viewpoint and took it into account,” he said.
He also acknowledged the IMF’s role in providing funding and technical assistance for the initiative, describing it as significant.
However, Edun said all the advice, information, and data that “these institutions are able to provide is of value, but we don’t always have to take their advice.”
