Tuesday 25 September, 2018

Finance Minister: NIF bonds oversubscribed by 82%

The National Investment Fund (NIF) bond offering was oversubscribed by 82 per cent.

Finance Minister Colm Imbert made the revelation at a PNM meeting on Saturday night at a meeting held by the People's National Movement (PNM) on Saturday night in Arima. 

The tax-free bonds went on sale on July 11 and closed off on August 8.

The NIF bonds were issued in three series: five-year bonds at 4.5 per cent interest, 12-year bonds at 5.7 per cent interest and 20-year bonds at 6.6 percent interest.

Addressing PNM supporters at the Upper Malabar Community Centre in Arima last night, the Finance Minister revealed that the final tally for the bonds applications is $7.3 billion.

 

“So we went out there to raise $4 billion. When the applications were counted, doubled counted and triple counted, the total applications or subscriptions to the NIF are a little more than $4 billion. So we achieved our target."

"The total is $7.3 billion, 82% oversubscribed. For the five year, where we were looking for about $800 million, the applications are $2.1 billion. In the 12 year, we were looking in between $800 million and $1.2 billion, the applications are $1.6 billion."

"But the shocker was the 20 year, because remember if somebody is investing in something for 20 years, it means you have tremendous confidence in the asset and the instrument.

"We were looking for somewhere between $800 million and $2 billion, we got $3.5 billion, in the 20-year (series),” the Finance Minister explained to supporters.

Imbert added that the NIF has therefore been a ‘fantastic success.’

He said despite all the things that the naysayers said the NIF has done well.

“The population has shown tremendous confidence in the government,” he said.

Meanwhile, the Finance Minister also added that there will be more bond offers next year.

Imbert said this will be done via housing bonds.

“The purpose of a housing bond is to raise capital to build houses. And our housing bonds will be designed in such a way that persons who purchase housing bonds would be able to use them to acquire HDC housing. But, in addition we’re going to structure it in such a way that the persons who invest in the housing bonds would have a special window in the acquisition of HDC housing,” Imbert explained.