Bond Market: Safety In A Season Of Uncertainty


Saturday, January 26, 2019 6:30AM /Proshare Research


Download PDF Report Here


Nigeria’s bond market was upbeat in 2018. The increase in recurrent fiscal and capital expenditure resulted in the federal government borrowing more money from both the local and foreign capital markets, leading it to issue fresh bonds and bills. Nigeria’s total debt stock in the year stood at $73,213bln or N22.429trn which included both Federal and State government liabilities. 

External debt fell by 2.02% or $21.592bln largely due to the redemption of a $500mln Eurobond which matured in July, 2018. It is expected that with oil prices hovering between $55 and $60 per barrel for most of 2019, the local Treasury bill market will be very active with yields staying between 15% and 17% similar to 2018.


The key features of the bonds and general fixed income securities market in 2018 were:

  • A shift from domestic to foreign debt as the FGN tried to reduce debt service cost.
  • More Eurobond issues with stretched maturity dates; yields ranged from 6.75% on 2021 bonds to 7.143% on 2030 bonds and 9.248% on 2049 bonds
  • Issuance of Sukuk Bonds to finance road construction
  • Issuance of Green Bonds to finance activities that clean up the environment and reduce toxic emissions


Table: Nigeria’s Debt Stock as at September 30, 2018 (in mln)

Proshare Nigeria Pvt. Ltd.

Source: Nigeria’s Debt Management Office (DMO)


The bond market in 2018 was very active as institutional investors took flights to safety by selling off equities to invest in bonds. Bond yields at between +15 and +17% in an inflationary environment of 11.28% looked (and still look) attractive at a time the stock market fell below a negative yield of -18%.


Do feel free to share your opinions/observations and feedback with us vide and/or

Download PDF Report Here


Related News From Proshare 2018 Review and 2019 Outlook Report - Surviving Uncertain Times In The Nigerian Financial Market

1.       Proshare NCM 2018 Review and 2019 Outlook (6) -  Mutual Funds -A Tale of Mixed Fortunes

2.      Proshare NCM 2018 Review and 2019 Outlook (5) - Market Records 8.53% Growth in Q1’18; Negative Sentiment Permeates in Subsequent Quarters

3.      Proshare NCM 2018 Review and 2019 Outlook (4) - Economic Indicators: Moving Forward Slowly

4.      Proshare NCM 2018 Review and 2019 Outlook (3) - African Markets Still Depressed

5.      Proshare NCM 2018 Review and 2019 Outlook (2)- Global Market in Tumbles

6.      Proshare NCM 2018 Review and 2019 Outlook (1)- Surviving Uncertain Times in the Nigerian Financial Market

Proshare Nigeria Pvt. Ltd.

Proshare Nigeria Pvt. Ltd.


Related News

1.       Glimmer Of Hope - Macro and Markets: 2018 Review and 2019 Outlook

2.      Nigeria 2019 Research Outlook: One Hurdle In Q1, Others To Follow

3.      NSR H1 2019 (9) - Fixed Income - Will Yields Hump or Shift?

4.      Global Foreign Investment Flows Dip To Lowest Levels In A Decade

5.      Discourse on Nigeria’s Investment Outlook 2019

6.      NSR H1 2019 (8) - Nigerian Fiscal - More Strain On FG Finances

7.      Fitch Ratings: Global Growth Outlook Dented Not Dismantled

8.     NSR H1 2019 (7) - Monetary Policy - Maintaining The Narrative

9.      Surviving Uncertain Times in the Nigerian Financial Market

10.  NSR H1 2019 (6) - Nigerian Inflation - Boiling Below The Surface

11.   Afrinvest Economic and Financial Market: 2018 Review and 2019 Outlook - On The Precipice

12.  NSR H1 2019 (5) - Currency - A Test Of Nerves And Resilience

13.  Coronation Research Issues 2019 Economic Outlook for Nigeria; A Tale of Two Halves

14.  NSR H1 2019 (4) - Domestic Economy - Stable Growth In Dire Need Of Fresh Impetus

15.   NSR H1 2019 (3) - Crude Oil - Not Great But Not All Gloom Either

16.  Meristem 2019 Outlook Report - Resilience in Vulnerability

17.   NSR H1 2019 (2) - MEA Region: A Year of Fragile Growth

18.  NSR H1 2019 (1) - Global Growth: New Year, Same Rhetoric, Matching Growth

19.  5 Key Global Developments to Watch in 2019

20. Nigeria Outlook 2019: Sailing Through The Storm

21.  FSDH Research Expects Modest Recovery in Equities’ Market in 2019

22. Nigeria Economic Outlook Conference 2019

23. Nigeria 2019 Outlook - As The Dominoes Fall


Related News