DMO blames glitches for delay in FGN coupon payment

The Nigerian government-owned, Debt Management Office, DMO has blamed the recent delay in coupon payments to savings bond subscribers on system and processing issues.

This is according to a report from Bloomberg on Friday.

DAILY POST reports that the first coupon payment on the two-year and three-year debt instruments, through which the government raised N4.2 billion in June, was due on Sept. 12 but has remained unpaid.

Reports showed that this marks the second consecutive delay in fulfilling obligations on a savings bond, according to investors.

Reacting to the development, Patience Oniha, the Director General DMO attributed the delay to a “system, process issue,” which is “being addressed.”

She said in response to questions. “I expect an outcome today”

The development comes as Subscribers to the savings bonds reported a week-long delay in coupon payments due in August, marking the first such delay since the instruments were introduced seven years ago. The delayed payment could raise concerns about the government facing pressure from its increasing debt burden.

Recall that the federal government raised N297.006 billion from the June bond auction, representing about 66 percent of its target. This amount is roughly 22 percent lower than the N380.769 billion raised in May.

Total subscriptions across all tenors in June amounted to N305.257 billion, significantly lower than the N551.316 billion subscribed in the previous month.

Meanwhile, stakeholders say the persistence of the delay would make investors lose confidence in Nigeria’s debt securities.