DLM Funding SPV Launches N30bn Sovereign-Backed Composite Notes

DLM Capital Group has commenced book building for the Series 1 Sovereign Bond-Backed Composite Notes (SBCNs) under its ₦30 billion Medium-Term Note Programme, aimed at addressing economic priorities while strengthening Nigeria’s capital markets.

The company described the issuance as a groundbreaking development, marking the world’s first public offer of Sovereign Bond-Backed Composite Notes. The notes provide investors with AAA-rated credit quality and full sovereign credit risk protection, backed by Federal Government of Nigeria (FGN) bond cashflows.

Offering a hold-to-maturity (HTM) yield of up to 47.07% per annum, the Series 1 SBCNs outperform standard government and corporate bonds. The offer is open from July 1 to July 14, 2025. Issued by DLM Funding SPV PLC and sponsored by DLM Capital Group, the notes have a 10-year tenor, maturing in 2035, with an average life of 5.5 years. They carry AAA ratings from both Global Credit Rating (GCR) and DataPro Ratings.

At the official launch held on June 18, 2025, at the company’s headquarters, Group CEO of DLM Capital Group, Dr. Babatunde Sonnie Ayere, stated, “This bond was created to address the growing demand for innovative, secure, and high-yield investment opportunities in the Nigerian capital markets.”

The SBCNs are structured under a bankruptcy-remote Special Purpose Vehicle (SPV), insulating investors from the financial obligations of the sponsor. Proceeds from the issuance will be invested in FGN bonds and used to finance consumer and SME loans, supporting inclusive economic growth across the country.