March 14, (THEWILL) – The Debt Management Office (DMO) has, on behalf of the Federal Government of Nigeria (FGN), reopened four FGN bonds valued at N360 billion for auction.
The DMO had in February, listed the bonds for subscription. However, in a notice on Tuesday, it reopened the first offer, a February 2028 FGN Bond valued at N90 billion (10-year re-opening), at an interest rate of 13.98 per cent per annum.
The second offer is the April 2032 FGN Bond valued at N90 billion (15-year re-opening), at an interest rate of 12.50 per cent per annum.
There is also the April 2037 FGN Bond valued at N90 billion (20-year re-opening), at the rate of 16.2499 per cent per annum.
The fourth offer is the April 2049 FGN Bond valued at N90 billion (30-year reopening), at an interest rate of 14.80 per cent per annum.
According to the DMO, the Bonds are offered at N1,000 per unit with 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 payment is done semi-annually while the bullet repayment (principal sum) is done on the maturity date,” the DMO said.
It said that the bonds were backed by the full faith and credit of the Federal Government of Nigeria, 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 (CITA) and Personal Income Tax Act (PITA) for tax exemption for pension funds amongst other investors.
“They are listed on the Nigerian Stock Exchange Limited and FMDQ OTC Securities Exchange.
“All FGN Bonds qualify as liquid assets for liquidity ratio calculation for banks,” it said.
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