FGN Bonds Yields Fall on Hint of Fewer Bonds Auction in the Coming Week…


In the just concluded week, the values of FGN bonds traded at the over-the-counter (OTC)
segment further appreciated for all maturities tracked amid sustained demand and signal by
Debt Management Office to auction fewer bonds in the coming week.

The 5-year, 14.50% FGN JUL 2021 bond, the 7-year, 13.53% FGN MAR 2025 note, the 10-year, 16.29% FGN MAR 2027 debt, and the 20-year, 16.25% FGN APR 2037 paper gained N0.01, N0.51, N6.31 and
N28.46 respectively; their corresponding yields fell to 1.55% (from 1.82%), 3.81% (from 3.94%), 4.76% (from 5.64%) and 6.31% (from 8.17%) respectively.

Meanwhile, the value of FGN Eurobonds traded at the international capital market depreciated for all maturities tracked on renewed bearish activity.

The 10-year, 6.75% JAN 28, 2021 bond, the 20-year, 7.69% FEB 23, 2038 paper and the 30-year, 7.62% NOV 28, 2047 debt lost USD0.03, USD3.21 and USD3.34 respectively; while their
corresponding yields rose to 3.79% (from 3.85%), 8.39% (from 8.03%) and 8.32% (from 7.99%) respectively.

In the new week, Debt Management Office will issue bonds worth N30 billion, viz: 12.50% FGN APR 2035 (15-Yr re-opening) worth N15 billion and 9.80% FGN JUL 2045 (25-Yr re-opening) worth N15 billion respectively.

We expect the bonds stop rates to moderate further amid fewer bonds issuance.

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