In September 2017, Nigeria issued its first Sukuk bond of N100 billion, which is set to mature on September 26, 2024. This information was reported in the 2023 Annual Activity Report of the Financial Markets Department of the Central Bank of Nigeria (CBN).
The Sukuk bond, adhering to the principles of Shariah, evidences a proportionate interest in ownership of tangible assets, usufructs, and services, combining both equity and debt features. The bond has been subject to rental payments at a rate of 16.47% on every March 26 and September 26 as a form of debt service.
Following its auction, the N100 billion 7-year debut Sukuk Offer was oversubscribed, with a total subscription of N105.878 billion. Notably, the offer attracted a diverse set of investors including pension funds, banks, fund managers, institutional, and retail investors. The raised funds have been used for the construction and rehabilitation of 25 roads across Nigeria’s six geopolitical zones, including major routes such as the Abuja-Abaji-Lokoja Road, the Obajana-Okene Road, the Suleja-Minna Road, and the Kaduna Eastern Bypass Road.
Since the introduction of the Sovereign Sukuk in 2017, Nigeria has issued a total of six Sukuk bonds. These subsequent issuances have seen significant subscription and have been utilized to support the construction and rehabilitation of over 4000 kilometers of roads and bridges across the country.