The Debt Management Office (DMO) has announced two new Federal Government of Nigeria (FGN) savings bonds offer at N1,000 per unit for September.
According to the notice on the DMO website issued on Monday regarding the latest offer, the first one is a two-Year FGN savings bond due in Sept. 14, 2024, at interest rate of 11.04 per cent per annum while the second is a three-year savings bond due in Sept. 14, 2025, at yearly interest rate 12.04 percent.
The DMO stated: “Offer opens on Sept. 5 and closes on Sept. 9. Settlement date is Sept. 14, while coupon payment dates are Dec. 14, March 14, June 14 and Sept. 14.
“They are subject to a minimum subscription of N5,000, and munulltiples of N1,000 thereafter, and subject to a maximum subscription of N50 million.
“Interest payment is made quarterly, while bullet repayment (principal amount) will be made on the maturity date”, it added.
According to the Office, the FGN savings bonds qualified as securities in which trustees could invest under the Trustee Investment Act.
It further clarified: “It also 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, among other investors.
“It is backed by the full faith and credit of the Federal Government of Nigeria and charged upon the general assets of Nigeria,” the DMO assured.
The DMO, in its latest quarterly public debt portfolio report for Q1 2022, indicated that Nigeria’s total debt stock rose to N41.6 trillion, representing a N2.05 trillion increase compared to N39.56 trillion recorded as of December last year.
Similarly, Nigeria’s debt-to-GDP ratio rose to 23.27% in the first quarter of the year, compared to 22.47% as of December 2022.
Although the debt stock level is lower than the government’s self-imposed limit of 40%, the rate is rising faster due to increased borrowing and not-too-impressive growth of the nation’s economy
