Nominal value is the same as face value. Quoted trading sizes are always on a nominal basis unless specifically mentioned otherwise.
For example, if an investor holds $1,000,000 in a Eurobond that pays a 10% coupon per annum, the total coupon the investor receives will be $100,000 per annum.
The total cash consideration is the total amount of cash an investor needs to buy a Eurobond. This therefore includes accrued interest.
The 2025 Republic of Nigeria Eurobond is used as an example in the below table.
Please see below for a further illustration.
When Eurobonds are issued, a minimum nominal amount is set. At present, $200,000 nominal is the threshold for all Nigerian Eurobonds with a $1,000 increment thereafter. There is one exception, which is Nigeria’s June 2022 Diaspora bond which has a nominal minimum of $2,000.
Nominal trading sizes below $200,000 are possible, either through the purchase of a structured note or a so-called “buy/sell-back” process. The latter is more common and largely depends on dealer willingness and inventory position.
Nominal trading sizes below the set minimum as commonly referred to as “fractional” or “sub-nominal” trading sizes. An example is provided below.
Say an investor wishes to purchase $100k nominal of the 2025 Republic of Nigeria Eurobond. This Eurobond has a $200k minimum and therefore every trade needs to be $200k or more in order to be executed and settled. In this case, the investor can purchase $300k and simultaneously sell back $200k in order to end up with the desired $100k.
Fractional trades do not happen often and are the discretion of the dealer to execute.