Babajide Sanw-oolu, the Lagos State governor, yesterday signed documents for the release of N100.33 billion, which the state government raised from the capital market to fund infrastructure and pressing capital projects, thus opening a new chapter in the state’s stride towards attaining self-sustenance in finance and governance.
At a signing ceremony held at the State House in Alausa, Sanwo-Olu, investors and issuing parties put the final ink on the over-subscribed series three bond issuance of N100 billion, which was issued and raised by the state government under its N500 billion third debt issuance programme approved four years ago.
The visibly excited governor declared the moment as “historic and new journey” for the state in its drive to provide requisite infrastructure to catalyse its economy, saying it is the largest bond programme ever embarked on by any sub-national entity in the country.
He said: “We have embarked on a new journey that is not meant to serve our personal interest, but to activate more prosperity for our dear Lagos and give our people the hope for better tomorrow we all dreamed. When we came into government, we made commitment to all Lagosians that we are coming to pursue and implement an agenda that will build our capacity to achieve ‘Greater Lagos’ we all will be proud of.
“Today, I am standing in front of you all to say we are writing the financial history of Lagos in another chapter today and it will bring good dividends to all residents. With this N100 billion, bond, we will ensure that all Lagosians feel the direct impact of this intervention in their homes and on the roads. We are bringing new infrastructure and repairing the existing ones, including bridges and hospitals. We are going to renovate schools and build new ones for our children; slums will be regenerated and pressing environmental issues we are going to solve. We are going to make people feel the essence of governance.”
Sanwo-Olu said the effort to raise the bond started three months ago with a simple discussion with professional partners led by Chapel Hill Denham.
He added that the state almost missed the opportunity as the statutory period recommended by Security and Exchange Commission (SEC) to raise such bond was about closing when the state started pushing for the bond issuance.
The governor said the partners staked their time and energy for the state to secure essential requirements to access the capital for the bond.
According to him, within a period of three months, the partners helped the state government to restructure its balance sheet and reduced the state’s interest expense by N17 billion, which gave the state the opportunity to raise the bond from the capital market.
“Less than three months down the line, we are celebrating the biggest sub-national bond issuance today and the team of partners has also helped us to restructure our entire balance sheet. We have been able to revert the entire borrowing of Lagos from very high rate to acceptable numbers. The team has also helped us to reduce interest expense by N17 billion, which made it easy for us to approach the financial market,” Sanwo-Olu stated.
He promised not to betray the confidence of investors that subscribed to the bond, pledging that the funds would be disbursed strictly to finance infrastructural projects required to boost the state’s economy.