Lagos to float N60bn bond this month

Lagos State government said at the weekend that it is set to float through the capital market a bond of N60 billion this month for infrastructural development.

Commissioner for Finance, Akinyemi Ashade, made this known at the Annual General Meeting (AGM) of Bond Series and Rating Programme held at the Civic Centre, Victoria Island, Lagos.

According to him, the N60 billion bond is the first tranche of the N500 billion bond series the State House of Assembly approved for the Governor Akinwunmi Ambode administration few months ago.

The state government is expected to be drawing the facility in tranches, disclosing that by next year, another N100 billion would be drawn from the same N500 billion bond approved by the State House of Assembly.

Speaking on the bond, Ashade said government needed deficit financing for the purpose of undergoing massive infrastructural development across the state.

The commissioner, while, disclosing that the Security Excahnge Commission (SEC) was already in the state to assess the projects the bond would be applied on, however, contended that the strength of the Internally Generated Revenue (IGR) qualified the state government for deficit financing, as means of paying back the bond.

Speaking on previous bonds, the commissioner said the bonds were used in executing worthwhile projects across the state, including the rehabilitation of Alimosho General Hospital, Ibeju Lekki General Hospital, Funsho Williams Avenue, construction of Ago Palace Way, reconstruction of Lagos-Ibadan Expressway, among others.

According to him, the bonds are: N57.5 billion fixed rated programme 1, Series 2 Bond of 2010 with a maturity date of 2017; N80 billion fixed rated programme 2, Series 1 Bond of 2012 which will mature in 2019 and N87.5 billion fixed rated programme 2, Series 2 Bond of 2013 with a maturity period of 2020.

Speaking further, Ashade said Lagos was often faced with infrastructural challenges, being the most populous city in Sub-Saharan Africa and the 5th largest economy in Africa due to its Gross Domestic Product, GDP size, was often faced with infrastructural challenges.

He said in view of this, there was the need for the state to continuously strive to increase its revenue base to meet the needs and aspirations of its citizens, adding that this informed the decision of the state government to borrow through the bonds, taking into cognizance its strong IGR base and its superb debt management structure.

“The bond series which the state government started in 2008 has had tremendous impact on the socio-economic development in the state and positively affected the life of the people. The state government has continued to manage and recently restructured two of its outstanding bonds, maki