Nigeria plans to redeem N762.5 billion ($2.5 billion) worth of treasury bills from the proceeds of a planned $2.5 billion Eurobond, to lower borrowing costs for the government, Kemi Adeosun, the finance minister said on Wednesday.
Nigeria expects to save N64 billion each year after it refinances the local bills with the dollar debt, she told reporters following a cabinet meeting Abuja.
In January, the director general of the Debt Management Office (DMO) indicated that government would consider raising $2.5 billion through Eurobonds in the first quarter to refinance a portion of its domestic treasury bill portfolio at lower cost.
It sold $3 billion in Eurobonds in November, part of which it used to fund its 2017 budget, and then paid off N198 billion naira in treasury bills in December.
The debt pay-off lead to a drop in rates by around 300 basis points, which translates into savings for the government, Adeosun said.
The minister said the cabinet has reappointed the banks that handled the previous Eurobond sale – Citigroup, Stanbic IBTC Bank and Standard Chartered Bank – for the new bond sale.