The Debt Management Office (DMO) has stated that the Federal Government of Nigeria will offer N150 billion worth of bonds available for subscription in October 2021.
This is according to a circular made available on the website of DMO and seen by naijabusiness.com.ng.
The breakdown of the offer shows that three categories of offers with different maturity dates will be made available to the public worth N50 billion each. The three classes of offer are succinctly captured below;
- 10-year re-opening bond to be offered at the rate of 12.50% due January 2026.
- 20-year re-opening bond to be offered at the rate of 16.24499% due April 2037.
- 30-year re-opening bond to be offered at the rate of 12.98% due March 2050.
Naijabusiness.com.ng gathered that the offer will be auctioned on the 20th of October, 2021 with the settlement date earmarked two days later on 22nd of October, 2021. The interest rate on the offer will be paid semi-annually while the bond will be redeemed with bullet repayment on the respective maturity dates.
The price for the offer is N1, 000 per unit subject to a minimum subscription of N50 million and in multiples of N1,000 thereafter. The bond will be listed on the Nigerian Exchange Limited (NGX) and on the platform of FMDQ OTC Securities Exchange.
FGN Bonds are backed by the full faith and credit of the Federal Government of Nigeria and are charged upon the general assets of Nigeria. It qualifies as liquid assets for liquidity ratio calculation for banks and it is a bit safer to invest while evaluated from the risk point of view.