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Nigeria’s borrowing costs hit 37%

The Federal Government’s domestic borrowing has risen to as much as N947.99 billion as at June 2018, a 37.04% increase from the previous year’s N687.37 billion, the Central Bank of Nigeria (CBN) reveals in its financial markets half year activity report released on Wednesday.

 

The bank attributes the rising cost to  the rise in the stock of the domestic debt, from N11.860 trillion at end-June 2017, to N12 .155 trillion at end-June 2018.

Nigeria’s central bank report shows that coupon payments for FGN Bonds, FGN Green Bonds and FGN Savings Bonds accounted for N542.73 billion or 57.62 per cent, N0.72 billion or 0.08 per cent and N0.50 billion or 0.05 per cent, respectively, while interest payments on Nigeria Treasury Bills (NTBs) and FRN Treasury Bonds stood at N379.51 billion or 40.29 per cent and N10.36 billion or 1.10 per cent, respectively.

Rental payments on FGN Sukuk of N8.17 billion or 0.87 per cent accounted for the balance, according to the report.

Concerns about an expected surge in federal borrowing have escalated in some quarters.

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Written by Ruth Olurounbi

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