Connect with us


NEWS

Nigerian Govt Reduces Exposure In Domestic Borrowing For Corporate Entities

Published

on

The Debt Management Office (DMO) says the Federal Government is reducing its exposure in the domestic market to pave way for borrowings by corporate entities.

Ms Patience Oniha, the DMO’s Director-General, told the News Agency of Nigeria (NAN) in Lagos that government had reduced its exposure in the bond market for corporate entities to raise funds.

“We are reducing the amount we borrowed in the domestic so that there will be space for corporate bodies,’’ the director-general said.

She said apart from the government decision to reduce domestic borrowing, the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE) had issued new guidelines and reduced fees for people to borrow.

Oniha said that apart from issues of infrastructure for trading in fixed income securities, the market regulators had done a lot of ground work to make the market attractive.

She said DMO was a friend with all regulators, noting that they work in teams and groups to get to “where we are today’’.

“We want to see varieties of products to be traded in the market apart from government bonds for people to have more varieties of products to trade on.

“We are expecting development in the market; we want to see corporate bodies to raise bonds in the market for people to have more products to buy apart from the government bonds,’’ Oniha said.

The director-general said that borrowing from the bond market would make books of corporate entities to be balanced instead of concentrating on banks’ loans.

She said that the fixed income market had grown when compared with what we had 10 years ago.

Oniha said that government expected the fixed income market to develop significantly long time ago.

The director-general had recently said the Federal Government would focus more on external borrowings to reduce debt servicing.

She said that in order to go forward the debt office would concentrate more on external borrowings at cheaper rates.

Oniha said that government had decided to borrow more externally to repay Treasury Bills (TBs) that mature every now and then.

“Going forward as we do more borrowing based on the Appropriation Act, what can we do to make sure that debt servicing at least, if it does not come down, remains manageable.

“We have decided to do more of external borrowings at cheaper rates,’’ Oniha said.

Nigeria’s top youth newspaper - actively working to deliver credible news, entertainment, and empowerment to 50 million young Africans daily.

Trending