The Lagos State Government has raised N85.14bn in the Series 2 Bond Issuance for the purpose of improving physical and social infrastructure in the state.

The Lagos State Commissioner for Finance, Mr. Akinyemi Ashade, was quoted in a statement on Monday as saying the bond was issued in two tranches as part of the N500bn third Debt Issuance Programme.

The first tranche, N46.37bn issued at 16.75 per cent, would mature in August 2024, while the second tranche, N38.77bn issued at 17.25 per cent, would mature in August 2027, he added.

According to him, the N85.14bn Series II issuance was the largest bond issuance in the Nigerian capital market in the last four years and the second largest issuance ever.

He said, “We value the reputation we have earned as the most responsible issuer in the Nigerian capital market and thank everyone who has worked with us to deliver a successful outcome.”

Hill Denham acted as Lead Issuing House and led an issuing party, including 10 other book runners, on what he described as a landmark transaction.

The state Governor, Akinwunmi Ambode, said he was encouraged by the sustained support the state’s credit story had received from investors.

He said, “In challenging market conditions, we are encouraged by the sustained support that the Lagos State credit story has received from investors for which we are grateful. This support is critical to our quest to improve the physical and social infrastructure in the state and lift the economic and social welfare of all citizens of Lagos State.”

Reuters reported stock brokers as saying the state paid higher interest than the inflation rate on the bond in a bid to lure investors into buying the debt.

It recalled that Nigeria’s annual inflation was 16.1 per cent in June, while data for July was being delayed by the National Bureau of Statistics till August 28.

The Federal Government paid 16.25 per cent on its 10-year bond last month, it said, adding that while most states in the country largely depended on their share of federal oil revenues, Lagos State had explored the debt market to fund its developmental projects.