Osun State bond, which hit the capital market, on Thursday, has been oversubscribed by more than 100 per cent, the Commissioner for Finance and Budget Implementation, Dr. Wale Bolorunduro, has said.
Bolorunduro said the government went to the capital market to raise N22bn but eventually realised N45.1bn.
According to him, this translates into over 100 per cent oversubscription.
Bolorunduro spoke during the bond’s completion ceremony between the state government and Joint Issuing Houses for a N30bn – 14.75 per cent fixed rate development bond.
The commissioner said Tranche 1 of the bond was due in 2019.
He said the N22bn bond also received 78 entries, which represented another unparalleled record in the annals of capital market transactions.
Bolorunduro said, “The state’s bond issue also changed completely the face of the capital market with over 60 per cent of the subscription cornered by the Pension Fund Administrators.
“This scenario represents a departure from the past in which offerings were dominated and snapped by the banks that normally played crucial roles in bond issuance.”
He added that this development validated the level of confidence long-term fund investors had in the state.
Governor Rauf Aregbesola noted that investor confidence came from the belief in the prudent management and financial engineering of his administration.
He described the transaction as a landmark bond, which had recorded a lot of firsts in Nigeria.