Modupe Gbadeyanka
By Modupe Gbadeyanka
Retail investors and low-income earners who intend to purchase the FGN savings bond for the month of December 2021 have till the noon of Friday, December 10, 2021, to do so.
The subscription for the investment tool started on Monday and the sale is being conducted by the Debt Management Office (DMO).
The FGN savings bond is a debt instrument offered by the federal government to get money from investors to finance some projects in the budget.
The debt office is offering the papers in two tenors of two years and three years.
According to the circular issued by the DMO, the 2-year FGN savings bond due December 15, 2023, is with the coupon 7.322 per cent per annum, while the 3-year FGN savings bond is due December 15, 2024, is with a coupon of 8.322 per cent per annum.
The disclosure further said the coupon would be paid to subscribers every March 15, June 15, September 15, and December 15 till maturity.
To be part of it, subscribers will have to 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 Federal Government of Nigeria (FGN) and charged upon the general assets of Nigeria.
It qualifies as securities in which trustees can invest under the Trustee Investment Act and qualifies as government securities within the meaning of the Company Income Tax Act (CITA) and Personal Income Tax Act (PITA) for tax exemption for pension funds, amongst other investors.
It also qualifies as a liquid asset for liquidity ratio calculation for banks and after-sale, it would be listed on the trading platform of the Nigerian Exchange (NGX) Limited.
