Abuja, Nigeria
The Debt Management Office (DMO) has announced its plans to reopen the auctioning for two federal government bonds.
The bonds valued at N350 billion are to be opened for subscriptions of N1,000 per unit.
FGN Savings Bonds are designed for retail investors, offering guaranteed quarterly interest payments and full repayment of the principal at maturity.
DMO, in a statement on Wednesday, said the offers are expected to be auctioned on April 28 and have their settlement date by April 30.
The DMO said it is authorised to receive applications for bonds in two tranches, with the first being N200 billion for a five-year savings bond due to mature in April 2029, at 19.3 percent per annum.
The debt office said the second tranche is N150 billion for a nine-year savings bond due to mature in May 2033, at an interest rate of 19.89 percent per annum.
According to the DMO, each unit will be priced at ₦1,000, with a minimum subscription of ₦50,001,000, and additional investments in multiples of ₦1,000.
“For Re-openings of previously issued bonds (where the coupon is already set), successful bidders will pay a price corresponding to the yield-to-maturity bid that clears the volume being auctioned, plus any accrued interest on the instrument,” DMO said.
“The agency also stated that interest payments will be made semi-annually, with the principal repaid in full as a bullet payment at maturity.
The DMO noted that the savings bonds qualify as approved securities for investment under the Trustee Investment Act.”
“Qualifies as Government securities within the meaning or the Company Income Tax Act (“CITA”) and Personal Income Tax Act (“PIA”) for Tax Exemption for pension funds amongst other investors,” the debt office said.
“Listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange.
“All FGN Bonds qualify as liquid assets for liquidity ratio calculation for banks.”
The DMO further clarified that FGN Bonds are backed by the full faith and credit of the Federal Government of Nigeria and are secured by the country’s general assets.
The agency advised all interested investors to contact Primary Dealer Market Makers (PDMMs) for participation.
In March, the DMO reopened two Federal Government bonds for auction, totaling ₦300 billion, with subscription prices at ₦1,000 per unit.
