The Debt Management Office (DMO) has restated its commitment to deepen the participation of retail investors in investment and trading of the Federal Government of Nigeria (FGN) bonds.
Speaking after a meeting with the Nigerian Stock Exchange (NSE) officials and ringing of the closing gong at the NSE yesterday in Lagos, the Director General of DMO, Dr. Abraham Nwankwo, said since 2012 there have been conscious efforts to ensure that FGN bonds are democratised to allow retail investors participate.
“The move led the DMO to appoint Stanbic IBTC Stockbrokers as government stockbrokers. It was part of our efforts to ensure that whatever service we deliver is democratised not just for the upper echelon alone but also for retail investors.
We wanted Stanbic IBTC to assist us in making sure that even retail investors with little money can also participate in the investment of FGN bonds, so that those investments can also be traded on the NSE. The NSE is not an elitist platform; it is not only for millionaires and billionaires but also for those with little money as N10,000. With N10,000 you can invest in FGN bond and have it listed on the NSE,” he said.
Nwankwo said the move also yielded some positive results, explaining that the visit to the NSE was part of continued engagement in ensuring that more retail investors are encourage to invest and trade in FGN bonds. “Our job is to encourage retail investors to buy FGN bonds and have their bonds traded on the NSE just as those of big investors. The DMO works in collaboration with other institutions both in public and private sectors so that we strategise and produce maximum results for the Nigerian economy. That is why we are here at the Exchange,” he stated.
On the impact of the recent restructuring of states’ banks loans into FGN bonds, the DMO boss said it has led to drop in the deduction for debt services.
“For some states, debt services deduction dropped by as high as 95 per cent. This means it has given the states some breathing space to enable them meet other obligations, particularly paying of salaries. However, the focus of government and DMO in making its contributions is to ensure that there will be medium to long term stabilisation of the fiscal conditions, particularly the establishment of state sustaining growth, which generate jobs,” he said.
According to him, the emphasis of government is that in the next couple of years, there will be a self-sustaining growth where employment will be generated, where the economy is well diversified so that there are many sources of foreign exchange revenue for the government.
In doing this, the onus is on Nigerians, individuals, institutions, public and private sectors to make their contributions so that the noble objective of the government to quickly diversify the economy so that there is an inclusion growth is achieved,” he said.
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