DMO opens two FGN savings bonds for subscription, offers up to 18% interest

The Debt Management Office (DMO) has announced an offer for two federal government of Nigeria (FGN) savings bonds.

The DMO made the announcement in a statement on Monday in Abuja.

The FGN savings bond offer is tailored and targeted at retail investors with guaranteed quarterly interest payment and repayment of the principal at maturity.

The agency said the offers, which opened on September 2, will close by September 6, at N1,000 per unit.

The debt office said while the settlement date is on September 11, coupon payment dates are made quarterly (December 11, March 11, June 11, and September 11).

The agency said the first offer is a two-year FGN savings bond due on September 11, 2026, at an interest rate of 17.202 percent per annum.

The second issuance, the office said, is a three-year savings bond maturing on September 11, 2027, at 18.202 percent per annum interest rate.

“They are issued 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 N50,000,000,” DMO said.

“Interest is payable quarterly while bullet repayment (principal sum) is on the maturity date.”

The DMO said the savings bonds are backed by the full faith and credit of the federal government of Nigeria (FGN), and chargeable on the country’s general assets.

“They qualify as securities in which trustees can invest under the Trustees Investment Act,” the agency said.

“They qualify as government securities within the meaning of Company Income Tax Act and Personal Income Tax Act for pension funds amongst other investors.”

The agency further said the bonds are listed on the Nigerian Exchange Limited (NGX) and qualify as a liquid asset for liquidity ratio calculation for banks.