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Nigeria’s green bonds market hits $136m as NGX lists potential

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Nigerian Exchange Group (NGX)


The value of Nigeria’s green bonds market has hit $136 million within three years with four issuances recorded since the debut issuance by the Federal Government.

In 2017, the NGX collaborated with the Ministry of Finance and other stakeholders to launch the first Climate Bond Initiative certified sovereign bond valued at N10.69 billion.

According to the Nigerian Exchange Limited (NGX), the issuances and listings include the N10.69 billion, 13.48 per cent five-year sovereign green bond issued in 2017 by the Federal Government of Nigeria (FGN); the N15 billon 15.5 per cent 5-year fixed rate senior unsecured green bond issued by Access Bank of Nigeria Plc.

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Others are N8.5 billion 15.6 per cent 15-year guaranteed fixed rate senior green infrastructure bond by North South Power Company (NSP) and the series II N15 billion 14.5 per cent FGN 7-year sovereign green bond in 2019 which recorded a 220 per cent subscription rate (oversubscribed by N17.93 billion).

At a retail investors’ webinar with the theme: “Sukuk and Green Bonds: More than just Investing”, the Chief Executive Officer (CEO) of the Nigerian Exchange Limited (NGX), Temi Popoola said the potential for sukuk and green bonds remains immense and is likely to expand over the years underpinned by new markets, products, issuers and healthy investor investors’ appetite.

He assured stakeholders that the exchange would continue to provide an efficient and liquid market for investors and businesses in Africa to access capital.

“We promise to continue our collaboration with all market stakeholders, to collectively contribute towards the enhancement of this exciting asset class, and ultimately towards the growth of green and sukuk bonds in Nigeria and Africa at large.”

Assistant Director, Securities Issuance Unit, Debt Management Office, Adamu Mohammed pointed out that investors are increasingly demanding socially responsible investment and have expressed a strong appetite for green bonds.

He noted that the subscription rates in Nigeria’s sovereign green bonds increased to 220 per cent in 2019 over the 110 per cent at the debut issuance.

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Director-General, Securities and Exchange Commission (SEC), Lamido Yuguda, represented by Abdulkabir Abass said: “I congratulate the conveners of this webinar, NGX for the consistency in holding educational programmes such as this that are focused on building capacity and growth the depth and breadth of the market.

He said the forum would create opportunities to educate retail investors on the benefits of investing in the Nigeria capital market through green and sukuk bonds.

He pointed out that the segment of the market is unique with immense potential that can facilitate the deepening of financial systems while spurring the growth of the economy.

Managing Director/CEO APT Securities and Funds Limited, Kasimu Garba Kurfi urged investors, especially those in the retail sector, to leverage opportunities in green bonds to diversify their portfolio. He added that investors could access the activities on the segment real time through the smart phones.

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