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NGX Highlights Opportunities in Green, Sukuk Bonds

Nigerian Exchange Limited (NGX) continues to drive the development and promotion of retail participation in the Nigerian capital market with its Retail Investor Workshop. On Tuesday, 31 August 2021, NGX hosted a webinar under the series in collaboration with APT Securities and Funds Limited themed, Sukuk and Green Bonds: More Than Just Investing.
Delivering the opening remarks, the Chief Executive Officer, NGX Limited, Mr Temi Popoola, CFA, highlighted the successes achieved with the growth of Sukuk and Green Bond Investment in Nigeria. He also noted that, “The potential for Sukuk and Green Bonds remains immense and is likely to expand over the years underpinned by new markets, products and issuers and healthy investor investors’ appetite. The Exchange will continue to provide an efficient and liquid market for investors and businesses in Africa, to save and access ethical and SDG complaint capital and investments. We promise to continue our collaboration with all market stakeholders, to collectively contribute towards the enhancement of this exciting asset class, and ultimately towards the growth of Green and Sukuk Bonds in Nigeria and Africa at large.”
On his part, the Director General, Securities and Exchange Commission (SEC), Lamido Yuguda, represented by Mr. Abdulkabir Abass stated, “I congratulate the conveners of this webinar, NGX for its consistency in holding educational programmes such as this which are focused on building capacity and growth the depth and breadth of the market. This is particularly noteworthy in the emerging segments of non-interest and socially responsible investment. As the apex regulator, the SEC has the dual responsibility of regulation and market development. Forums like this, therefore, afford us the opportunity to educate retail investors on the gain of investing in the nigerial capital market through Green and Sukuk Bonds. These segments of the market are quite unique and boast full potential that can facilitate the deepening of financial systems while spurring the growth of the economy, making this deliberation indeed timely.”
The webinar featured a presentation on Harnessing Green Bond as a Tool for Personal Growth, by the Assistant Director, Securities Issuance Unit, Debt Management Office, Mr Adamu Mohammed. He pointed out that investors are increasingly demanding socially responsible investment and have expressed a strong appetite for Green Bonds evidenced by subscription rates in Nigeria’s Sovereign Green Bonds increasing to 220% in 2019 over the 110% at the debut Issuance. The Managing Director/CEO APT Securities and Funds Limited, Mr Kasimu Garba Kurfi also provided insights on bridging the gap between ethical investing and socio economic development, before going on to feature in a panel session alongside Ms. Ummahani Ahmad Amin, Board Member, NGX; and Dr. Afolabi Olowookere, Head, Economic Research and Policy Management Division, SEC.
It is a well-known fact NGX collaborated with the Ministry of Finance and other stakeholders to launch the first Climate Bond Initiative certified Sovereign Bond. Owing to the leadership of NGX, the Nigerian green bond market grew from zero value into a N0 to N49.19Bn ($136Mn) within a 3 year period, recording 4 issuances and listings – the N10.69Bn, 13.48% 5-year Sovereign green bond issued in 2017 by the Federal Government of Nigeria (FGN); the N15Bn 15.5% 5-year Fixed Rate Senior Unsecured Green Bond issued by Access Bank of Nigeria Plc; the N8.5Bn 15.6% 15-year Guaranteed Fixed Rate Senior Green Infrastructure Bond by North South Power Company (“NSP”); and the Series II N15Bn 14.5% FGN 7-year sovereign green bond in 2019 which recorded a 220% subscription rate (oversubscribed by N17.93bn).