FG Offers N450bn Bonds For Sale

By Adedapo Adesanya

Nigeria, through the Debt Management Office (DMO), has offered three bonds for subscription to interested investors to the tune of N450 billion.

The DMO, in its offer circular on Monday, said that the first offer was an April 2029 FGN bond, valued at N100 billion at an interest rate of 19.30 per cent per annum. (5-year re-opening).

It listed the second offer as a February 2031 FGN bond valued at N150 billion at an interest rate of 18.50 per cent per annum. (7-year re-opening) and the third offer (January 2035 FGN bond) valued at N200 billion.

The auction date is January 27, and the settlement date is January 29, the notice stated.

According to the DMO, the FGN bonds are offered at N1,000 per unit subject to a minimum subscription of N50 million, and in multiples of N1,000 thereafter.

“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 on the instrument.

“Interest is payable semi-annually, while bullet repayment (principal sum) is on the maturity date, ” the DMO said.

It said that the bonds were backed by the full faith and credit of the Federal Government, and were 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 the Company Income Tax Act and Personal Income Tax Act for tax exemption for pension funds among others.

“They are listed on the Nigeria Exchange Limited, ” it said.

It said that they qualified as liquid assets for liquidity ratio calculations for banks,” the debt office added.