The Bank of Industry (BOI) has announced that its maiden N250 billion domestic bond was oversubscribed within five working days, following strong demand from institutional investors.
The bond was issued through BOI Financing SPV Plc under the bank’s $1 billion Multi-Currency Instruments Programme.
The transaction attracted a diverse group of institutional investors, including the Nigeria Sovereign Investment Authority (NSIA), International Finance Corporation (IFC), pension fund administrators, banks, development finance institutions and corporates.
BOI said the strong demand represented a vote of confidence in the bank and the ability of Nigeria’s domestic capital market to mobilise long-term funding for economic development.
Olasupo Olusi, BOI’s managing director and chief executive officer, said the investor response demonstrated the growing capacity of the domestic financial system to convert institutional savings into long-term financing for productive investment.
“The strength of the investor response is a vote of confidence not only in BOI, but also in the capacity of Nigeria’s domestic capital market to mobilise long-term capital for productive investment,” Olusi said.
He said BOI would channel the funds towards financing Nigerian businesses, supporting industrial expansion, creating jobs and strengthening domestic value chains.
BOI Targets Productive-Sector Financing
The bank said the bond proceeds would support businesses across priority sectors of the economy.
According to BOI, the funding will be used to support business expansion and modernisation, local value addition, job creation and economic diversification.
The transaction provides BOI with an additional source of long-term funding beyond its traditional funding channels, allowing it to tap directly into Nigeria’s pool of institutional capital.
The move is particularly significant for businesses requiring longer-tenor financing, as manufacturers and other productive-sector companies continue to contend with elevated borrowing costs.
Olusi also attributed the strong investor demand partly to incentives approved by President Bola Tinubu to support the transaction.
“As a Development Finance Institution, we could not have received the strong investor demand for the bond in five working days without the support of President Tinubu who gave his executive approval for various incentives to encourage investors,” he said.
The BOI chief executive added that Tinubu had approved a N100 billion fund for the bank.
According to Olusi, the fund would be used to blend the pricing of the bond and cushion the effect of high interest rates on manufacturers and other customers of the bank.
He described the approval as a demonstration of the administration’s support for Nigeria’s productive sector.
Institutional Investors Drive Demand
The participation of pension fund administrators, banks, development finance institutions and corporates highlights the depth of institutional demand for long-term domestic fixed-income instruments.
NSIA and IFC were among the institutional anchors for the transaction, according to BOI.
The strong demand also comes as Nigeria’s financial markets continue to play a larger role in mobilising domestic savings for infrastructure, business expansion and other productive investments.
For BOI, the successful bond issue marks a shift in its funding strategy, giving the development finance institution another avenue to access long-term capital from Nigerian investors.
The bank said the transaction would strengthen its capacity to provide financing to businesses while supporting broader economic diversification.
However, BOI said the final subscription and allotment figures would not be disclosed until regulatory approval is obtained.
The bank said the oversubscription demonstrated strong appetite for BOI’s debt instruments and long-term domestic assets, while underscoring the role of Nigeria’s capital market in financing economic development.
