The Debt Management Office (DMO) of the Federal Government has made three FGN bonds, each worth N150 billion, available for subscription at a rate of N1,000 per unit.
The first offer is a five-year reopening of the N150 billion April 2029 FGN bond, with an interest rate of 19.30 percent, according to a DMO announcement. The second offer is a reopening of the February 2031 FGN bond, which is worth N150 billion and has an interest rate of 18.50 percent, for a period of seven years.
A fresh N150 billion nine-year FGN bond due in May 2033 is the subject of the third offer. The 13th is the auction day, and May 15th is the settlement date. “They are offered at N1,000 per unit subject to a minimum subscription of N50million and in multiples of N1,000 thereafter,”’ the DMO said.
It said that for re-openings of previously issued bonds, successful bidders will pay a price corresponding to the yield-to-maturity bid that clears the volume being auctioned plus any accrued interest. The agency said that interest payment would be made semi-annually while the bullet repayment (principal sum) is on the maturity date.
“FGN bonds are backed by the full faith and credit of the Federal Government of Nigeria and are charged upon the general assets of Nigeria. They qualify as securities in which trustees can invest under the Trustee Investment Act.
“They qualify as government securities within the meaning of Company Income Tax Act and Personal Income Tax Act for tax exemption for pension funds amongst other investors. They are listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange,” it said.
The DMO added that all FGN bonds qualify as liquid assets for liquidity ratio calculation for banks.
It urged all interested investors to contact Primary Dealer Market Makers (PDMMs) like First Bank, First City Monument Bank, Access Bank, Citibank among others. FGN bonds, like other Federal Government securities, constitute the domestic component government borrowing.
