DMO announces FG’s issuance of a N15 billion Series II Green Bond

The Debt Management Office (DMO), has announced the Federal Government’s issuance of a green bond valued at N15 billion.

According to a statement made available by the DMO, the bond will be deployed to finance some projects in renewable energy, afforestation, and transportation.

To this end, the Debt Management Office, alongside the Ministry of Finance and the Ministry of Environment, is embarking on roadshows between yesterday and today, to raise awareness about the green bond.

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“Through the offer, the Federal Government seeks to raise N15bn to finance projects with green credentials. These eligible green projects can be classified under three themes within the green bond framework, namely: renewable energy, afforestation, and transportation.

“To ensure the success of the Series II Green Bond (“the Offer”), the Federal Ministry of Finance, Federal Ministry of Environment and the DMO will be engaging investors at respective roadshows in Lagos and Abuja on May 27 and 28.”

Previous Development: Note that the N15 billion green bond will be the second of its kind after the Federal Government issued a bond in December 2017. The Federal Government’s successful issuance of an N10.69 billion Green Bond made Nigeria the first country in Africa to do so.

Green Bond and Climate Change: The DMO said the issuance of the Series 11 Green Bond is indicative of the Federal Government’s commitment to reduce greenhouse emissions by as much as 20% come 2030.

“The Series II Green Bond issuance is a further demonstration of the Federal Government’s commitment to the reduction of greenhouse gas emissions by 20 percent (unconditionally) by 2030, as outlined under the Paris Agreement signed on September 21, 2016.”

In the meantime, Moody’s Investors Service has assigned a GB1 (Excellent) Green Bond Assessment to the FG’s latest N15 billion green bond offer.

Those interested in the offer should note that the DMO is working with Chapel Hill Denham Advisory Limited, Capital Assets Limited, Rand Merchant Bank Nigeria Limited, and Stanbic IBTC Capital Limited, as financial advisers/issuing houses to the offer.

What is a Green Bond? Green Bonds are specifically earmarked to be used for climate and environmental projects. These bonds are typically asset-linked and backed by the issuer’s balance sheet, and are also referred to as climate bonds.