The Debt Management Office (DMO) on Friday, pursuant to its (Establishment) Act 2003 and the Local Loans (Registered Stock and Securities) Act, CAP. L17, LFN 2004, offered three Federal Government’s bonds for subscription by auction to the investing public.
The Office, in a circular hoisted on its website, listed the debt instruments as including N75,000,000,000 at 13.53% FGN MAR 2025 (10-yr Re-opening), N75,000,000,000 at 12.50% FGN APR 2032 (10-Yr Re-opening); and N75,000,000,000 at 13.00% FGN JAN 2042 (20-Yr Re-opening) bonds.
According to the debt management agency, the Auction date for the bonds is July 18, 2022 and the Settlement date is July 30, 2022.
It further stated that bonds were offered for sale at N1,000 per unit subject to a minimum subscription of N50,001,000 and in multiples of N1,000 thereafter.
The DMO further disclosed on the interest rate for re-openings of previously issued bonds, (where the coupon is already set), that successful bidders would pay a price corresponding to the yield-to-maturity bid that clears the volume being auctioned, plus any accrued interest on the instrument, adding that interest will be paid semi-annually on the bonds.
On the status of the bonds, it stated that FGN bond qualifies as securities in which trustees can invest under the Trustee Investment Act; 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 investments listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange; and that all FGN Bonds qualify as liquid assets for liquidity ratio calculation for banks.
In addition, it stated that FGN bonds were backed by the full faith and credit of the Federal Government of Nigeria and are charged upon the general assets of Nigeria.
The DMO advised interested investors to contact offices of any of the Primary Dealer Market Makers (PDMMs).
