By Modupe Gbadeyanka
On Monday, September 2, 2019, the sale of FGN Savings Bond for the month of September 2019 commenced with two maturities on offer; the 2-year paper and the 3-year paper.
The exercise is being conducted by the Debt Management Office (DMO) on behalf of the Nigerian government and would close today, Friday, September 6, 2019.
Business Post reports that the debt office is offering the 2-year FGN Savings Bond due September 11, 2021 at 11.150 percent per annum and the 3-year FGN Savings Bond due September 11, 2022 at 12.150 percent per annum, with the interest payable quarterly and the bullet repayment on the maturity date.
To subscribe, the DMO has said investors must pay N1,000 per unit subject to a minimum subscription of N5,000 and in multiples of N1,000 thereafter, subject to a maximum subscription of N50 million.
The FGN Savings Bond is backed by the full faith and credit of the Nigerian government and charged upon the general assets of the country.
The paper qualifies as securities in which trustees can invest under the Trustee Investment Act, it qualifies 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.
It further qualifies as a liquid asset for liquidity ratio calculation for banks and the note, after this exercise, would be listed on the Nigerian Stock Exchange (NSE).
Those interested in purchasing the bonds would have to get in touch with stockbroking firms appointed as distribution agents by the DMO.
Adedapo Adesanya