Nigerian govt reappoints banks to handle $2.5bn Eurobond

Nigerian govt reappoints banks to handle $2.5bn Eurobond
February 07 22:47 2018 Print This Article

By Ahmed Idris

The Federal Executive Council (FEC) on Wednesday approved the reappointment of a consortium of banks made up of Citi Group, Standard Chartered, Stanbic IBTC, Whitten-Case and African Practice to handle the $2.5 billion Eurobond, Minister of Finance, Mrs Kemi Adeosun, has said.

The minister, who disclosed this at the end of the weekly Federal Executive Council meeting in Abuja, also spoke on the impacts of the use of the proceeds of the $500 million issued in November 2017, saying about N162.50 billion was used to redeem Nigerian Treasury Bills (NTBs) which matured in December 2017.

“The immediate impact was a significant drop in the Bid Rates at the Auctions of both NTBs and FGN Bonds. In December 2017 and January 2018,” she said.

She said the NTBs dropped from about 16 per cent to 13 per cent while the bonds dropped from about 16.50 per cent to 13.50 per cent, stressing that the development translates to savings for government on new borrowing while also making the cost of borrowing for the real sector cheaper since the sovereign rate serves as a benchmark for other borrowers.

“The estimated proceeds of the N762.5 billion will be used to redeem NTBs. At estimated current NTBs rates of 15 per cent following mop-up operations by the CBN, the savings from the refinancing of N762.5 billion of domestic debt using external capital raising is about N64 billion per annum,” she said.

Also speaking, Minister of Interior, Mr. Abdulrahman Dambazau, said the council also approved the purchase of 35 operational vehicles for the Nigeria Immigration Service (NIS) at N483.21 million.

He said the council was briefed on the progress of the implementation of the 17 memos it has approved for the Ministry of Interior including strategy for handling prisons decongestion and rehabilitation to meet international standards, issues of prisoners on death roll, etc.

Also speaking, Minister of Communications, Mr. Adebayo Shittu, said the council approved radio equipment to detect illegal radio signals with a view to blocking them.