Some state governments and quoted companies raised N53.48 billion from the bonds market of the Nigerian capital market in the first seven months of 2014.
Analysis of bonds transactions between January and July in Lagos showed that N15.08 billion was raised through corporate bonds, while N38.4 billion was by government bonds.
An analysis of the bond further showed that Dana Group of Companies during the period under review raised N4.5 billion through a corporate bond with coupon rate of 16 per cent. Nigerian Aviation Handling Company Plc sourced for N2.05 billion at a coupon rate of 15.25 per cent.
La Casera Company Plc floated a corporate bond worth N3 billion at a coupon rate of 15.75 per cent, FSDH Funding Special Purpose Vehicle (SPV) raised N5.53 billion at coupon rate of 14.25 per cent. In the period also the Ekiti State Government led and raised N5 billion at a coupon rate of 14.50 per cent, while Nasarawa State Government floated N5 billion bonds with a 15 per cent coupon rate.
Niger Government issued bonds worth N12 billion at a coupon rate of 14 per cent, while Kogi State Government raised N5 billion. Osun Government during the period also floated bonds worth N11.4 billion at a coupon rate of 14.75 per cent. Malam Garba Kurfi, the Managing Director, APT Securities and Funds Ltd., commended the return of corporate bonds in the market.
Kurfi said that the global financial meltdown of 2008 was responsible for investors’ loss of confidence in the equities market. He also said that the emergence of corporate bonds in the market would reduce the overcrowding of government bonds. Kurfi said that the capital market offer cheap long-term financing for development projects when compared with borrowing from the commercial banks.