DLM Capital Makes Inaugural Repayment of Both Capital and Interest on Triple-A Rated SBCN Securities

DLM Capital Group, a prominent Development Investment Bank, has made a significant milestone by successfully executing the first scheduled principal and coupon payment to investors under its Sovereign Bond-Backed Composite Notes, thereby reinforcing investor trust in the structure.

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This payment, made in accordance with the transaction's expected cash flow profile, serves as early validation of the SBCN structure's robustness, credit integrity, and cash flow reliability, providing a key performance milestone for the program.

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The ₦30.00 billion Medium-Term Notes Programme, issued by DLM Funding SPV Plc, comprises ₦7.30 billion Tranche A Notes with a 40.62% Hold-to-Maturity return and ₦1.70 billion Tranche B Notes with a 19.07% return, demonstrating the structure's diverse investment options.

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The Notes were listed on FMDQ Exchange, with the Tranche A instrument now holding the position of the most valuable AAA-rated corporate bond in the Nigerian capital markets, showcasing the structure's credibility.

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The SBCN structure, developed by Sonnie Babatunde Ayere, Group Chief Executive Officer of DLM Capital Group, introduces a unique fixed income product that combines sovereign bond collateralization with structured cash flow engineering to deliver enhanced risk-adjusted returns.

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At issuance in July 2025, the transaction garnered significant market attention, as is typical for innovative instruments, and notably achieved a transition from the sponsor's BBB- rating profile to AAA ratings on the instrument by both Global Credit Ratings and DataPro Limited.

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Six months post-issuance, the successful delivery of the first principal and coupon payment marks a critical inflection point, demonstrating the structure's ability to perform not only in design but also in execution, thus bolstering investor confidence.

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The SBCNs are specifically designed to prioritize capital preservation, predictable cash flow generation, liquidity support mechanisms, and enhanced yield relative to comparable risk instruments, offering a unique combination that resonates with institutional investors.

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This combination has begun to gain traction with institutional investors seeking high-quality fixed income exposure in an evolving macro and yield environment, leading to increased recognition of the SBCNs as a credible, de-risked, and performance-oriented instrument.

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As market interest builds toward Series 2, the SBCN program is increasingly positioned as a new benchmark for structured fixed income innovation in Nigeria's debt capital markets, solidifying its reputation as a successful issuance.

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In line with its mandate as a Development Investment Bank, DLM Capital Group remains committed to designing and delivering institutional-grade financial solutions that deepen capital markets and support long-term economic development, expanding investor access to high-quality instruments.