Today's FGN Bond & CBN T-Bills Auction: 17th September, 2014

Proshare

Wednesday, September 17, 2014 6.50AM / Meristem Wealth Management Limited
 

Issue on Offer/Summary

The Federal Government of Nigeria (FGN) through the Debt Management Office (DMO) will be conducting a bond auction on Wednesday 17th September, 2014 at the primary bond market. Three major instruments (FGN 3-year, 10-year and 20-year bonds) are to be auctioned as scheduled for a total amount of NGN100bn and are all re-openings.

 

13.05% FGN AUG 2016 (3-Yr Re-opening)         NGN15, 000,000,000

14.20% FGN MAR 2024 (10-Yr Re-opening)         NGN50, 000,000,000

12.15% FGN JULY 2034 (20-Yr Re-opening)        NGN35, 000,000,000

 

Given our analysis of the current yield environment vis-a-vis our bond valuation models, we present below our advised bid rates:   

13.05% FGN AUG 2016                                           10.80% - 10.95%

14.20%FGN MAR 2024                                            11.89% -12.09%

12.15% FGN JULY 2034                                          12.01% -12.16%

Kindly click download to view the full report.

Bond Auction                           DOWNLOAD  
 

Issue on Offer/Summary

The Central Bank of Nigeria (CBN) is scheduled to hold Treasury Bills (T-Bills) Primary Auction on the 3rd of September, 2014. T-Bills worth a total of NGN182.85bn will mature, while an equal sum will be issued in 91-day, 182-day and 364-day instruments. The CBN is expected to auction NGN27.850bn and NGN65.000bn and NGN90.000bn in 91-day, 182-day and 364-day instruments respectively.

 

Based on the reasons stated in the report, current liquidity level in the system and expected demand in the auction, we advise rates with the dual purpose of achieving the best possible yields as well as ensuring the success of the bid. The stop rates for the respective instruments are listed below:

91-Day                  NGN40.648bn                         9.80% - 9.90%

182-Day                NGN30.000bn                       10.10% - 10.20%

 

Kindly click download to view the full report.

 T-Bills Auction     DOWNLOAD

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