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Tag: DMO

  • FG reopens 4 bonds valued at N360bn for auction

    FG reopens 4 bonds valued at N360bn for auction

    The Debt Management Office (DMO), has on behalf of the Federal Government of Nigeria (FGN), listed four FGN bonds valued at N360 billion for auction.

    Announcing the bond auction, the DMO listed the first offer as a Feberuary 2028 FGN bond, valued at N90 billion at interest rate of 13.98 per cent per annum (10-year re-opening).

    The second is an April 2032 FGN bond, valued at N90 billion at 12.50 per cent interest rate per annum (10-year re-opening)

    There is also an April 2037 FGN bond, valued at N90 billion, at 16.24 per cent interest rate per annum (20-year re-opening).

    The fourth offer is an April 2049 FGN bond, also valued at N90 billion, at an interest rate of 14.80 per cent per annum (30- year re-opening).

    It announced that the auction date is Feb. 13, while settlement date is Feb. 15.

    According to the DMO, for re-opening of previously issued bonds, successful bidders will pay a price corresponding to the yield-to-maturity bid that clears the volume being auctioned plus any accrued interest on the instrument.

    “Interest is payable semi-annually, while bullet repayment (principal sum) is on the maturity date.

    “FGN bonds are backed by the full faith and credit of the Federal Government of Nigeria and are charged upon the general assets of Nigeria.

    “They qualify as securities in which trustees can invest under the Trustee Investment Act.

    “They also qualify as government securities within the meaning of Company Income Tax Act and Personal Income Tax Act for tax exemption for funds among other investors.

    “They are listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange,’’ the DMO said.

    It said that all FGN bonds qualify as liquid assets for liquidity ratio calculation for banks.

  • JUST IN: Gombe Govt denies N432bn debt profile

    JUST IN: Gombe Govt denies N432bn debt profile

    Gombe State Commissioner of Finance and Economic Development, Mr Muhammad Magaji has denied the State owes over N432 billion in debts.

    Magaji made the disclosure in Gombe while giving details of the N176.01 billion 2023 budget signed into law by the State Governor, Inuwa Yahaya on Friday.

    He said in spite that the debt profile of Gombe was available on the website of the Debt Management Office (DMO), some persons in the name of politics had continued to spread fake figures.

    He stated that though the state government had inherited over N124 billion in debt from the previous administration, the current administration was working to reduce the debt and make the state financially viable.

    According to him, the state’s debt profile currently is N120 billion and “this is verifiable and accessible to everyone who visits the DMO.”

    “I know that there had been political issues saying Gombe State is owing N432 billion, so the figure (N120 billion) is not up to one third of the figure being peddled around.

    “The debt profile of Gombe State is just at about N120 billion; it is verifiable.

    “It tells you that we have not borrowed too much, not even outside the approval that is the debt ceiling that you will not borrow outside.”

    Magaji said the question on Gombe debt profile had become a recurring one, “principally, probably for political reasons”.

    The commissioner stated that the current administration had been servicing the huge debt it inherited and “in 2023 budget, N18.21 billion, representing 10.35 per cent of the total budget, will be used to service debt”.

    According to him, the state government has continued to pay salaries, pensions, settling backlogs of gratuities owed since 2014.

    He encouraged residents of the state not to listen to the fake news being peddled around.

    The commissioner assured that “ this government is financially sound; we have met our obligations from every quarter and there is no reason to fear whatsoever.

    “Some people can continue to peddle (fake news) because they want to take government but the people of Gombe are wiser and know better,” he said.

  • Debt sustainability: We deploy tools, strategies on borrowing-DMO

    Debt sustainability: We deploy tools, strategies on borrowing-DMO

    The Debt Management Office (DMO), says it deploys certain economic tools and strategies in contracting loans for the Federal Government to ensure debt sustainability.

    The Director-General of DMO, Patience Oniha said this in an interview with newsmen on Friday in Abuja.

    Oniha spoke against the backdrop of a recent workshop for the Senate Committee on Local and Foreign Debts and the House of Representatives Committee on Aids, Loans and Debt Management.

    According to her, DMO ensures that maturities of public debts are spread over a period of time to ensure sustainability.

    “Maturities in the public debt portfolio are well spread to avoid bunching of maturities and to ease payments of maturing obligations.

    “The domestic debt portfolio has securities with tenors ranging from 91 days to 30 years., while the external debt portfolio has securities ranging between five years to 30 years,’’ she said.

    According to Oniha, there is a wide range of financial instruments such as the Federal Government of Nigeria (FGN) Savings Bond, Sovereign Sukuk, Green Bonds, a 30-year FGN Bond and a 25-year FGN bond available to investors.

    “These options have helped to widen the investor base and provide products to suit the needs of every investor,’’ she said.

    Oniha said that the DMO had started raising funds strictly for projects, adding that there was more control over such loans.

    She cited the bilateral loans, the Sukuk, through which a total of N615.557billion was raised between 2017 and 2021, and the Green bonds, which generated N25.59 billion between 2017 and 2019.

    “Bilateral loans are deployed to projects like rail and airports.

    “From the Sukuk loans of N615, 557 billion, N365, 557 billion was deployed for the construction of 71 roads and six bridges, constituting 1,881 kilometres.

    “Proceeds from the Green bonds were deployed to seven projects in various sectors, including renewable energy, agriculture, water, transport and afforestation,’’ she said.

    The Director-General said that the DMO was also deploying debt management tools of the World Bank and the international Monetary Fund (IMF) to enable debt sustainability.

    According to her, the tools include an annual Debt Sustainability Analysis (DSA) and Medium Term Debt Management Strategy (MTDS) every four years.

    She said that the implementation of the MTDS 2020-2023 is expected to moderate the level of debt related risks like refinancing and exchange rate risk.

    Oniha said that it would further improve the structure of the public debt portfolio.

    According to her, Nigeria’s total public debt as percentage of the Gross Domestic Product (GDP) stood at 23.06 per cent as at June 30.

    “It is within the 55 per cent threshold recommended by the IMF and the World Bank, as well as Nigeria’s self-imposed limit of 40 per cent set in the MTDS 2020-2023,’’ she said.

    She said that exposure of the country’s total public debt portfolio to exchange rate risk remained moderate, as domestic debt constituted 60 per cent of total public debt.

    Oniha said that target ratio under the MTDS was 70:30, with the DMO expecting to achieve the target by the end of 2023.

    “The exposure to refinancing risk remains stable as a result of the strategy of issuance of long dated securities in the domestic and international markets,’’ she said.

  • Reps committee grills DMO over N3.3 trillion domestic debt

    Reps committee grills DMO over N3.3 trillion domestic debt

    The House of Representatives Committee on Aids, Loans and Debt Management on Monday grilled the Director-General, Debt Management Office (DMO), Ms Patience Oniha, over rise in domestic debts totalling N3.3 trillion in 2023.

    Rep. Ahmed Safana, the Chairman of the Committee, in Abuja, expressed surprise at the astronomical increase in debt profile of the country through borrowing by the government.

    The committee rejected continuous borrowing by the Federal Government.

    According to the lawmaker, there is a huge increase in domestic and external debts from borrowed funds by the Federal Government and the DMO is entrusted with role of ensuring frequency of repayment.

    He said that there was N1trillion increase in the debt profile of the country in the last one year, while calling on DMO, as relevant agency, to halt the frequency of borrowings.

    According to the DG, the domestic debt profile of the country stood at N3.685 trillion and there is another N2.57 billion from external borrowing by government.

    The committee said borrowings by government at any level must be tied to specific projects and demanded details of the N3.55 trillion earmarked for borrowing in 2023 budget.

    At the budget session, a member of the Committee, Rep. Emeka Azubogu (Anambra-PDP) decried frequent borrowings while others demanded details of the personnel cost of the agency and the number of its employees.

    Another member of the House Committee, Rep. Steve Azaiki (Bayelsa-PDP) advised the Federal Government to engage consultants to be able to access funds from the $70 billion climate change funds in the USA.

    Rep Promise Dike (Rivers-PDP) demanded that the agency should submit to the committe all details of assets sold, payment made and outstanding debts owed to the agency under privatisation.

    Responding, Oniha said domestic debt profile rose from N3.2 trillion in 2022 to N3.3 trillion in 2023 due to high interest rate from borrowed funds from domestic and international sources of funds.

    She said that borrowing was a collective responsibility and there was need for the parliament to look at borrowing of funds by the government from macro-economic perspectives.

  • Nigeria’s woes compound as public debt stock hits N42 trillion

    Nigeria’s woes compound as public debt stock hits N42 trillion

    The Debt Management Office (DMO) said Nigeria’s total public debt stock, which was N41.60 trillion (100.07 billion dollars) in March rose to N42.84 trillion (103.31 billion dollars) by June.

    According to a statement obtained from DMO’s website on Tuesday, the total debt represents the domestic and external debt stocks of the Federal Government of Nigeria (FGN), the 36 State Governments and the Federal Capital Territory (FCT).

    It, however, said that while the foreign component of the debt remained at the same level of N16.61 trillion (39.96 billion dollars), the local component increased to N26.23 trillion (63.24 billion dollars). The local component of the country’s borrowings was N24,98 trillion (60.1billion dollars) as of March 30.

    The DMO said that a larger percentage of the external debts were concessional and semi-concessional loans.

    “Over 58 per cent of the external debt stock are concessional and semi-concessional loans.

    “They were obtained from multilateral lenders such as the World Bank, International Monetary Fund, Afrexim and African Development Bank, and bilateral lenders including Germany, China, Japan, India and France.

    “The total domestic debt stock increased from N24,98 trillion (60.1billion dollars) in March to N26.23 trillion (63.24 billion dollars) in June.

    “This is due to new borrowings by the FGN to part-finance the deficit in the 2022 Appropriation (Repeal and Enactment) Act, as well as new borrowings by state governments and the FCT,” the DMO said.

    It said that the total public Debt-to-GDP ratio remained within limits, at 23.06 per cent, while Debt-Service-to-Revenue was still high.

    It added that the federal government was committed to increasing revenue so as to reduce the amount that went into debt servicing.

    “The Debt-to-GDP as at June 30, was 23.06 per cent compared to the ratio of 23.27 as at March 30. It remains within Nigeria’s self-imposed limit of 40 per cent.

    “While the Federal Government continues to implement revenue-generating initiatives in the non-oil sector and block leakages in the oil sector, Debt Service-to-Revenue ratio remains high,” it said.

    Meanwhile, the DMO is set to take its FGN Securities Awareness Programme to Yola on Wednesday and Umuahia on Sept. 29.

    According to Patience Oniha, DMO’s Director-General, the programme is designed to sensitise Nigerians on the huge investment benefits in FGN securities, thereby boosting financial inclusion.

  • Bayelsa spends N3.52bn on debt service to commercial banks in May

    Bayelsa spends N3.52bn on debt service to commercial banks in May

    The Bayelsa government on Friday said it spent  N3.52 billion on servicing its loan obligations to commercial banks for the month of May.

    The domestic debt stock data from the Debt Management Office for Bayelsa as of March 31, stood at N151.41 billion.

    Mr Timipre Seipulo, Technical Adviser to Gov. Douye Diri of Bayelsa on Treasury Matters, stated this while giving an update of the state’s income and expenditure profile for the months of May and June in Yenagoa.

    According to the financial highlights, the state generated some N1.68 billion from internal sources in addition to a gross inflow of N22.86 billion from the federation account to make a total of N22.91 billion for May.

    Of the amount, derivation revenue, a 13 per cent of value of crude oil produced within the state for May stood at N17.82 billion.

    On the other hand, non oil revenue of N124.69 million accrued to the state for the month under review.

    According to Seipulo, the state’s wage bill for civil servants and political appointees gulped N6.2 billion.

    For the month of June, Bayelsa got N18.67 billion after deductions at source from the federation account.

    Oil derivation accounted for N14.02 billion, while the internally generated revenue was N1.99 million. The total wage bill for the month of June was N6.14 billion.

  • Nigeria’s public debt shoots to N39 trillion

    Nigeria’s public debt shoots to N39 trillion

    The Debt Management Office (DMO), says Nigeria’s public debt as at December, 2021 is N39.55 trillion.

    Patience Oniha, the Director-General of the DMO, said this on Thursday, while addressing newsmen on the country’s debt situation.

    Oniha said that the amount represented the total external and domestic debts of the Federal Government, 36 state governments as well as the Federal Capital Territory (FCT).

    Recall that DMO had earlier revealed that the country’s debt stock as at September 2021, was N38 trillion.

    She said that the increased public debt included new borrowings by both the Federal Government and state governments.

    “For the Federal Government, it would be recalled that the 2021 Appropriation and Supplementary Acts included total new borrowings of N5.48 trillion
    to part-finance the deficits.

    “Borrowing for this purpose, and disbursements by multilateral and bilateral creditors account for a significant portion of the increase in the debt stock, ” she said.

    Oniha said that the new borrowings were raised from diverse sources, which included issuance of Eurobonds, Sovereign Sukuk and Federal Government of Nigeria Bonds.

    “These Capital raisings were utilised to finance capital projects and support economic recovery,’’ she said.

    According to Oniha, the country’s debt situation is within reasonable limits.

    She, however, said that the Federal Government had taken concrete steps to address revenue challenges which made servicing of the debts burdensome.

    “With the total Public Debt-to-Gross Domestic Product ratio of 22.47 per cent, the debt ratio still remains within Nigeria’s self-imposed limit of 40 per cent.

    “This ratio is prudent when compared to the 55 per cent limit advised by the World Bank and the International Monetary Fund (IMF) for countries in Nigeria’s peer group.

    “The Federal Government is mindful of the relatively high Debt-to-Revenue ratio and has initiated various measures.

    “The measures are to increase revenue through the Strategic Revenue Growth Initiative and the introduction of Finance Acts since 2019,’’ she said.

  • DMO’s January bond auction receives N300bn over subscription

    DMO’s January bond auction receives N300bn over subscription

    The Debt Management Office (DMO) says its just concluded Federal Government of Nigeria (FGN) bond auction for January was oversubscribed.

    DMO, which made this known in a statement on Thursday, stated that the auction received a total of 160 bids.

    It revealed some minor adjustments in the bonds offer during the auction.

    “Our FGN bond auction for January 2022 concluded yesterday with a total of 160 successful bids.

    “The auction recorded an over-subscription of N111 billion and N214 billion for the January 2026 and January 2042 bond offers respectively.

    “Successful bids for 12.5 per cent FGN January 2026 and 13 per cent January 2042 were allotted at the marginal rates of 11.5 per cent and 13 per cent respectively.

    “However, the original coupon rates of 12.5 per cent for the FGN January 2026 will be maintained while the coupon rate for 13 per cent FGN 2042 (New Issue) is set at 13 per cent, ” it explained.

    The News Agency of Nigeria (NAN) recalls that the DMO had recently released a bond issuance calender for the first quarter of 2022

  • $3.5bn loan: DMO allays fears over possible takeover of critical national assets by Chinese Government

    $3.5bn loan: DMO allays fears over possible takeover of critical national assets by Chinese Government

    The Debt Management Office (DMO) has clarified that loans from China to Nigeria, which presently stood at 3.59 billion dollars, constitute only 9.4 per cent of the country’s total foreign debt stock of 37.9 billion dollars.

    Ms Patience Oniha, the Director-General of DMO made this known in an interview with the News Agency of Nigeria (NAN) on Saturday in Abuja.

    She also clarified that the loans were largely concessional, as no national asset was tagged as collateral.

    NAN reports that in recent times, both the social and mainstream media have been awash with news about some African countries, including Nigeria, facing the threat of losing some critical national assets to the Asian country due to high level indebtedness.

    “Nigeria’s total debt stock as at Sept. 30 was 37.9 billion dollars, this figure comprised the external debt stock of the Federal Government, 36 state governments and the Federal Capital Territory.

    “ But total loans from China stands at 3.59 billion dollars, which is 9.47 per cent of the total external debt. The loans did not require any national asset as collateral; they were largely concessional,’’ she said.

    Oniha urged Nigerians to always endeavour to verify sensitive information from official sources before disseminating it.

    She explained that before foreign loans were contracted, very sensitive steps were taken by multiple institutions of government to ensure that they were beneficial to the nation.

    “Before any foreign loan is contracted, including the issuance of Eurobond, they are approved by the Federal Executive Council and thereafter, the National Assembly.

    “An important and extremely critical step is that the loan agreements are approved by the Federal Ministry of Justice.

    “An opinion is issued by the Attorney-General of the Federation and Minister of Justice before the agreements are signed.

    “Several measures which operate seamlessly have been put in place to ensure that data on debt are available and that debt is serviced as at when due. Provisions are made explicitly for debt service in the annual budgets,’’ she said.

    Oniha explained that the loans agreements provided a number of steps to take to resolve dispute when they arise.

    “The first action is that the parties should resolve it within themselves and if that fails, they go to arbitration.

    “In other words, a lender, in this case, China, would not just pounce on an asset at the first sign of a dispute, including defaults,’’ the she said.

    She explained that the DMO maintained proper records of debts, provided projections for debt service and processed the actual payments for debt service.

    She pointed out that those functions were carried out in conjunction with the Office of the Accountant-General of the Federation (OAGF) and the Central Bank of Nigeria (CBN).

  • Why there is increased borrowing since 2015 – FG

    Why there is increased borrowing since 2015 – FG

    The federal government has said the increased level of borrowing since 2015 was due to the collapse in revenues from crude oil.

    TheNewsGuru.com (TNG) reports Patience Oniha, Director General of the Debt Management Office (DMO), Nigeria made this known on Wednesday.

    She stated that the level of new borrowing started trending downwards from 2018 up to the first 2020 Appropriation Act.

    “Unfortunately, the adverse impact of COVID-19 on revenues and increased spending, have resulted in higher levels of borrowing,” she said.

    Oniha explained that the public debt figures published by DMO are the debt stock of the federal government, the 36 states and the FCT.

    “I am compelled to respond to some recent comments about the level of Nigeria’s Public Debt.

    “Firstly, it is useful to state that the Public Debt figures published by @DMONigeria are the Debt Stock of the FGN, the 36 states and the FCT.

    “That is, the Debt is not only that of the FGN as the FGN, state governments and the FCT have all been borrowing.

    “At the Federal level, the increased level of borrowing since 2015 was due to the collapse in revenues from crude oil.

    “The level of New Borrowing started trending downwards from 2018 up to the first 2020 Appropriation Act.

    “Unfortunately, the adverse impact of COVID-19 on revenues and increased spending, have resulted in higher levels of borrowing.

    “While @DMONigeria, using the DSA and MTDS, manages the public debt to ensure that Nigeria’s public debt is sustainable and that borrowing is done at the lowest possible cost, growth in revenues remain a key focus of fiscal authorities,” Oniha stated.