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Tuesday, 02 April 2013 00:00
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DMO floats N100b sinking fund for redemption of bonds investment

The Debt Management Office (DMO), said it is floating N100 billion sinking funds to guarantee the redemption of its bonds issues as well as other bonds issuance in the securities market, even as it said that a total of $1billion Eurobond bond issuance is expected to hit the financial market in the second quarter in addition to the Diaspora Bond being expected before the end 2013.

In his appraisal of the agency’s activities in the first quarter of the year, on the auspecies of the Capital Market Committee (CMC), Director General of DMO, Dr. Abraham Nwankwo disclosed that the sinking fund would be an  account accruable from all allocations from the external reserves, which would ensure the guarantee of repayment to investors on bonds issues by both the Federal and States governments. 

Nwankwo noted that the fund would enhance liquidity in Nigeria bond market, and also make securities lending possible including exchange Bonds  and fixed income securities  that are not liquid to  be changed to active Bond . He also noted that it can indirectly give investors the opportunity to interswitch securities.

In a similar vein, Nwankwo disclosed  that new Issues of federal Government securities currently in the  financial market, valued at N380billion  had been redeemed  with N40billion had settled various class of investors .

He added that the recent  revamping of the bond market  has imparted positive on inflow of  capital, along the   JP Morgan index  stating, that theiInclusion of the FGN securities on the emerging market index has had an added advantage on reform investors confidence in Nigeria economy. Adding the foreign investors and portfolio investors confidence on the Nigeria.