As revealed in a public notice on the DMO website, the sukuk, issued on behalf of the Federal Government of Nigeria, forms part of the government’s broader infrastructure financing strategy.

The bonds have a seven-year tenor, a rental rate of 19.75% per annum, and are due to mature in May 2032.

The subscription period opens on May 12, 2025, and closes on May 20, 2025, with the settlement date set for May 23, 2025.

The minimum subscription is N10,000, in multiples of N1,000 per unit, and subsequent purchases are also available in multiples of N1,000, allowing a wide range of investors to participate and promoting financial inclusion.

During an investor meeting on the “FGN N300 Billion Series VII Sovereign Sukuk Issuance,” Patience Oniha, director-general of the DMO, reassured investors about the stability of Nigeria’s debt structure. She stated:

“There’s more transparency now. FX supply has improved, and the rates have become more stable. Some of the measures were difficult at first, but the benefits are beginning to show.

“Over 60 percent of our external debt comes from multilaterals and bilaterals, which offer more favorable terms than commercial debt. This diversification reduces our exposure to market shocks and provides stability.”

DMO listed Greenwich Merchant Bank Limited, Vetiva Capital Management Limited, and Stanbic IBTC Capital Limited as issuing houses for the bond and advised interested investors to contact them.

The N300 billion, seven-year Ijarah Sukuk bond is part of the federal government’s strategy to fund critical roads and enhance infrastructure development across Nigeria’s six geopolitical zones.

Funds raised from the Sukuk will be used exclusively for the rehabilitation of key road projects and bridges, with the invested funds backed by the full credit of the Federal Government of Nigeria.

After successfully raising over N11.4 billion through its N100 billion Sukuk Issue Programme, the bank listed a N10 billion Mudarabah Sukuk issuance.

An Additional Tier 1 Capital Mudarabah Sukuk with loss-absorbency features is the first of its kind in Nigeria and is intended to help TAJ Bank improve its capital adequacy ratio and overall corporate business operations.

Both retail and institutional investors were interested in the issuance, which led to a subscription of 113.6. The oversubscription of this Issuance shows that Nigeria’s investment culture is still strong and that there is ongoing optimism about the country’s ability to achieve economic stability and recovery.

Alhaji Tanko Gwamna, Chairman of TAJBank, who was present at the closing gong ceremony honoring the listing of the Sukuk issuance on the Exchange floor together with other top bank officials, reaffirmed that the listing is the first of its kind on the trading floor and that it is non-interest bearing.

He pointed out that the capital market requires the listing of the Corporate Sukuk to provide liquidity and propel Nigeria’s economy forward.

TAJBank Boss disclosed that the financial institution is considering investing in the manufacturing and Agriculture sectors with raised funds from the Sukuk.

“Manufacturing sector is the only sector that can take most of the youth out of the street and keep them engaged. Also, we are funding agriculture production and its value chain from start to finish. These two sectors are where we wanted to fund the Sukuk issuance,” he said.

“The listing on the Exchange is for investors to trade in the Sukuk and diversify their investment,” he added.

According to him, “We are setting the trend and I’m sure a lot of corporates will come along. We are making more offerings because the market needs corporate Sukuk. It was a transparent exercise and people can trade with our Sukuk and it will offer more liquidity for economic growth.

He added that the financial institution very soon will be back in the capital market and raise more funds.

Speaking also, the Managing Director/CEO, TAJBank, Mr. Hamid Joda said the Sukuk listing aims to give Nigeria’s investors alternative means of investment.

He noted that “Millions of investors have been yearning for non-interest or Islamic instruments. We believe this is an opportunity for them to invest in such an instrument.

“The funds raised will be deployed into high-impact sectors that create jobs in Nigeria’s economy and in that way, it will have high-impact opportunities for millions of Nigerians.

“I believe with this move; we have inspired many other corporates in the financial space to come on board and issue Sukuk for greater development of our dear country.”

In a statement obtained by TechEconomy, Tuesday, DMO said it also listed the Sukuk on the FMDQ Securities Exchange Limited.

Proceeds from the Sovereign Sukuk, which was heavily oversubscribed, were meant for execution of infrastructural projects across the country.

According to the DMO, the listing is done to maximise market liquidity for investors in the Sovereign Sukuk

“To maximise market liquidity for investors in the Sovereign Sukuk, the DMO is listing the N250 Billion Sovereign Sukuk, which was issued in December 2021, on the NSE and the FMDQ Securities Exchange.

“The N250 Billion Sovereign Sukuk is the fourth one issued by the DMO and had a massive oversubscription of N865 Billion at time of issuance.

“This made it the highest subscription level recorded since the first Sukuk issuance in September 2017.

“It is also a representation of investors’ growing confidence in the benefits of Sukuk to the development of the Nigerian economy,” the DMO said.

It said that proceeds of the Sovereign Sukuk since its inception have been deployed towards the construction and rehabilitation of road networks across the six geopolitical zones.

It added that the impact of such projects have been evident.

“Currently, proceeds from the N250 Billion Sovereign Sukuk are being utilised across 77 key economic road projects in the country

“The projects include the completion of roads B6, B12 and Circle road, Abuja; Abuja-Lokoja road (Koton Karfe-Lokoja); and rehabilitation of Yola-Hong-Mubi road in Adamawa State.

“Others are dualisation of Kano-Katsina road; dualisation of Sapele-Ewu road; rehabilitation Of Old Enugu – Onitsha road; dualisation of Ibadan-Ife-Ilesah road; dualisation Of Akure – Ado Ekiti road, among others,” it said.