Nigeria to Issue Second 30-year Naira Bond Today

By Dipo Olowookere

The Debt Management Office (DMO) will today offer to investors the 30-year Naira dominated Bond on behalf of the federal government of Nigeria for the second time.

The note debuted last month and it was oversubscribed by 400 percent, according to the debt office.

Business Post reports that N20 billion worth of the debt instrument was issued in April 24, 2019 at a coupon rate of 14.80 percent and according to a circular issued last week by the DMO on today’s exercise, N30 billion worth of the 30-year paper would be auctioned at the same 14.80 percent.

It was disclosed that a total of N100 billion bond is up for grabs in three maturities; 5-year, 10-year and 30-year, all re-opening, with the settlement date fixed for May 24, 2019.

The DMO said it would offer N35 billion of the 5-year note at 12.75 percent and another N35 billion of the 10-year bond at 14.55 percent.

The debt office said intending subscribers would be expected to pay N1,000 per unit subject to a minimum subscription of N50 million and in multiples of N1,000 thereafter.

They will have to approach the following financial institutions for subscription; Access Bank Plc, First Bank of Nigeria Ltd, Standard Chartered Bank Nigeria Ltd, Citibank Nigeria Ltd, First City Monument Bank Plc, United Bank for Africa Plc, Coronation Merchant Bank Ltd, FSDH Merchant Bank Ltd, Zenith Bank Plc, Ecobank Nigeria Ltd, Guaranty Trust Bank Plc, FBNQuest Merchant Bank Ltd and Stanbic IBTC Bank Plc.

The bonds qualify as securities in which trustees can invest under the Trustee Investment Act. They also qualify as government securities within the meaning of Company Income Tax Act (CITA) and Personal Income Tax Act (PITA) for Tax Exemption for Pension Funds amongst other investors.

They are liquid assets for liquidity ratio calculation for banks and are backed by the full faith and credit of the Federal Government of Nigeria and are charged upon the general assets of Nigeria.

In addition, the bonds would be listed on the Nigerian Stock Exchange and FMDQ OTC Securities Exchange.