BY NKECHI NAECHE-ESEZOBOR—The Federal Government, through the Debt Management Office (DMO), has announced the subscription details for its upcoming bond auction, offering a total of N900 billion.
According to a notice posted today via DMI’s official website the first offer is a Feb. 2031 FGN bond (seven-year re-opening), valued at N300 billion, at 18.50 per cent interest rate per annum.
The second offer is a Feb. 2034 FGN bond (10-year re-opening), valued at N400 billion at 19.00 interest rate per annum.
The third offer is a Feb. 2035 FGN bond (10-year re-opening), valued at N200 billion at interest rate of 22.70 per cent per annum.
Each bond is offered at N1,000 per unit, with a minimum subscription of N50,001,000 and in multiples of N1,000 thereafter. Interest is payable semi-annually, and principal will be repaid in full (bullet repayment) on maturity.
For the re-opened bonds, where the coupon is already set, successful bidders will pay a price corresponding to the yield-to-maturity bid that clears the auction volume, along with any accrued interest.
FGN bonds are fully backed by the government, qualify as trustee-approved securities, and are listed on both the Nigerian Exchange Limited and FMDQ OTC Securities Exchange. They also count as liquid assets for banks and enjoy tax exemptions under the Company Income Tax Act and Personal Income Tax Act, making them attractive to pension funds and institutional investors.
