In accessing stable long-term finance to fund their key activities, six companies have raised and listed a total amount of N110.21 billion corporate bonds corporate bonds on the FMDQ Securities Exchange Plc in 2019.
The four other companies include: Primero Transport Services Limited, North South Power Company Limited, Access Bank Plc, Mixta Plc, Sterling Bank and Flour Mills of Nigeria Plc.
In reviewing the amounts listed by the companies, FMDQ Securities admitted the listing of the Primero BRT Securitization N16.5 billion Series one Fixed Rate Bond and NSP-SPV PowerCorp Series one N8.50 billion 15.60 per cent 15-year Fixed Rate Senior Green Infrastructure Bond under its N50 billion Bond Issuance Programme.
Others are the Access Bank N15 billion 5-year 15.50 per cent Fixed Rate Senior Unsecured Green Bond due 2024, and Mixta Real Estate N2.96 billion Tranche A and N2.32 billion Tranche B Series two Bonds under a N30.00 billion Debt Issuance Programme and the quotation of the Mixta Real Estate N9.84 billion Series one and N2.08 billion Series two Commercial Papers under a N15.00 billion Commercial Paper Issuance Programme.
Also, others include: Sterling Investment Management SPV N32.90 billion Series two, 7-Year 16.50 per cent Fixed Rate Unsecured Bond, under a N65.00 billion Debt Issuance Programme and Flour Mills N20.11 billion bonds, comprising N10.11 billion Series 1 and N10 billion Series 2 Senior Unsecured Fixed Rate Bonds under its N70 billion Bond Issuance Programme.
Bonds are fixed income instruments issued by entities to raise funds. The issuer of a bond presents the bond as a promise to make available regular, fixed, income payments to the investor or the buyer of the bond who is also the bondholder.
These income payments are known as coupons and bonds which pay coupons twice a year are known as semi-annual coupon bonds. There are also bonds that make coupon payments annually, known as annual coupon bonds.
In august 2019, FMDQ OTC Securities Exchange upgraded to FMDQ Securities Exchange, in being a full fledge securities exchange with registration to trade in all securities including fixed income, equities, derivatives, commodities and foreign exchange.
FMDQ Securities Exchange said it would continue to exert commendable efforts in aligning the Nigerian financial markets to international standards, and had, through the promotion of product innovation and the championing of key market development initiatives, ensured that opportunities abound for the markets under its purview.
Also, the Exchange’s mandate is to provide a reliable and credible avenue for corporate and governments, amongst others, to raise capital and by so doing, foster the deepening of the markets and ultimately, the economic development of the nation.
Financial analysts said that Nigeria has witnessed the resurgence of debt issuances in the last five years and the tempo has been on the increase, saying that from corporates in the banking sector, to real estate and to those in the Fast-moving consumer goods (FMCG), businesses are seizing the opportunity to raise capital from a debt market that has seen its risk appetite grow in recent times.
The managing director/CEO of FMDQ, Mr. Bola Koko, stated that, “FMDQ has supported the enhancement of market credibility which has, in turn, boosted investor confidence in the Nigerian Debt Capital Market (DCM), through the provision of unprecedented transparency, spearheading of initiatives to boost secondary market liquidity and facilitating effective price formation, among other activities via its platform.’’
Onadele reiterated that through consistent collaboration with its stakeholders, FMDQ shall continue to further deepen and effectively position the Nigerian DCM for growth, and invariably contribute to the growth of the economy at large.
Also, associate executive director of FMDQ, Ms. Tumi Sekoni, noted that the OTC Exchange’s commitment to continue to innovate and provide efficient services, as may be necessary, to support issuers and investors, towards achieving an operationally excellent and globally competitive debt capital markets (DCM).
At the listing of Access Bank green bond, the group managing director/CEO of the Bank, Mr. Herbert Wigwe, stated that “with our pace-setting experience in the mainstreaming of sustainability in our business operations, we are confident that this issue will further help in supporting environmentally friendly investors to meet their investment objectives. It will also simultaneously support Access Bank’s customers towards realizing growth opportunities in a fast-developing low-carbon economy.”
The managing director of HighCap Securities Limited, Mr. David Adonri said, Mr. Rotimi Fakayejo, said companies partaking in corporate bond and commercial papers realised the attractiveness.