FMDQ OTC Securities Exchange on Thursday recorded another feat with the admission of commercial papers (CPs) of FSDH Merchant Bank Ltd (FSDH) worth N14.98 billion on its platform. The CPs represented Series1 and 2 under FSDH’s N30 billion CP Issuance Programme. Commercial paper is a money-market security issued by large corporations to obtain funds to meet short-term debt obligations.
It is backed only by an issuing bank or company’s promise to pay the face amount on the maturity date specified on the note, usually within 270 days. FMDQ Managing Director, Mr Bola Onadele, said the issuance of the CPs at this time testified to the increasing confidence in the possibilities of the Nigerian debt capital market (DCM).
Onadele said that FMDQ was very positive about the potential of a fully-functional DCM in building a sustainable economy. He said the company would continue to support and streamline the market processes and infrastructure to support issuers and investors toward achieving an operationally excellent and competitive DCM.
Mr Rilwan Belo-Osagie, the Managing Director, FSDH, said that the CPs were quoted on the FMDQ platform in line with the Central Bank of Nigeria (CBN) requirements. Belo-Osagie said that the quotation would facilitate active secondary market trading of the CPs.
He said that FSDH was very active in the CP market prior to its suspension by the CBN in 2009. Belo-Osagie said that the quotation of the CP served as an opportunity for FSDH to restate its presence and significance in the money market and participate in the development and deepening of the CP market.
“The establishment of FMDQ has contributed significantly to the growth in liquidity and transparency of the Nigerian fixed income market. FSDH is committed to supporting the growth of this market through the FMDQ platform,” he added. Mr Kobby Bents- Enchill, Executive Director & Head, Debt Capital Market, Stanbic IBTC Capital Ltd., said that the company was excited about the growth of the CP market.
“Over the past two years, we have witnessed a remarkable increase in the number of issuances in the CP market and we are proud to be pivotal to the development of this market,” Bentsi- Enchill said. He said that increase in the number of CP issuances on the FMDQ platform was vital to creating liquidity in secondary market trading of CPs.
“We are exceptionally pleased to have worked with FSDH in setting up
its maiden CP Programme and the successful debut issuance of N14.98bn across Series 1 and 2.
“We are also pleased to sponsor the quotation of the FSDH CP on the FMDQ platform.
“FSDH has demonstrated its commitment to the growth of the fixed income market by its decision to complement its funding requirements by accessing the money and capital markets in Nigeria,” Bentsi-Enchill said. FMDQ has progressively continued to champion and effectively support initiatives aimed at boosting the growth and development of the Nigerian DCM and economy at large. The company is actively collaborating with its varied stakeholders to realise it’s mandate of making the Nigerian financial market competitive globally.
