DLM Capital Group Makes First Payment on Sovereign Bond-Backed Notes
DLM Capital Group, a Development Investment Bank, has successfully executed the first principal and interest payment to investors under its Sovereign Bond-Backed Composite Notes issuance. This milestone reinforces investor confidence in this innovative fixed income instrument, highlighting the group's commitment to transparency and capital preservation.
Details of the SBCN Issuance
The SBCNs were issued by DLM Funding SPV Plc as part of a ₦30.00 billion Medium-Term Notes Programme, developed by Group Chief Executive Officer Dr. Sonnie Babatunde Ayere. The issuance includes:
- Tranche A Notes: ₦7.30 billion with a 40.62% Hold-to-Maturity rate.
- Tranche B Plain Vanilla Series 1 Notes: ₦1.70 billion with a 19.07% rate.
These notes were recently listed on the FMDQ Exchange, with Tranche A emerging as the most valuable AAA-rated corporate bond in the market. The instruments represent a new class of structured debt solution designed to meet issuer funding needs while delivering competitive returns to investors.
Market Response and Ratings
Launched in July 2025, the SBCNs entered the market amid initial skepticism common with new financial instruments. However, six months post-issuance, DLM Funding SPV Plc has successfully met its first principal and coupon obligations, validating the structure's robustness.
The notes have received AAA ratings from both Global Credit Rating and DataPro Limited, reflecting strong credit fundamentals and a low-risk profile. This instrument prioritizes capital preservation, liquidity, and competitive market returns for institutional investors.
Investor Confidence and Future Prospects
DLM Capital Group reports that investor participation remains strong, supported by timely coupon payments, high credit ratings, and sustained disclosure practices. Growing investor interest ahead of Series 2 indicates increasing market acceptance of the SBCNs.
As a Development Investment Bank, DLM Capital Group reaffirms its commitment to delivering structured financial solutions aligned with investor needs while maintaining high standards of governance and execution. The group stated, "Investor response has been notably strong, with institutional investors recognizing the value of a well-structured, de-risked, high-return, and high-quality fixed income investment backed by a credible issuer with a proven track record."
"The combination of timely coupon payments, high credit ratings, and ongoing transparency has positioned SBCNs as a preferred option for investors seeking stability and performance in today's evolving financial landscape."
"As investor interest continues to build towards Series 2, DLM SBCNs are not only demonstrating resilience but also setting a benchmark for innovation in Nigeria's debt capital markets."
