DMO to auction N150bn FGN bonds in July

The Debt Management Office (DMO) says it will offer N150 billion bonds for subscription by auction in July on behalf of the federal government.

In a circular issued on Monday, DMO said the bonds will be in three tranches, comprising N50 billion each.

The first is a 10-year reopening bond to be offered at the rate of 13.98 with a maturity date in February 2021; the second is a 15-year reopening bond to be offered at 12.40 percent rate with a maturity date in March 2036; while the third is a 30-year reopening bond to be offered at 12.98 percent rate and will mature in March 2050.

According to the circular, the auction date is on July 19, 2021, while the settlement date is on July 26, 2021.

DMO said the transactions will be at N1, 000 per unit subject to a minimum subscription of N50,001,000 and in multiples of N1,000 thereafter.

It also said that the interest is payable semi-annually with the redemption expected to be in bullet payment on the maturity date.

“For Re-openings of previously issued bonds, (where the coupon is already set), 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,” the circular reads.

The DMO had earlier announced that the federal government’s bonds for June worth N150 billion were oversubscribed by 178.32 percent at N417.48 billion.

The total subscriptions received from investors for the June bonds comprised of N66.21 billion for 16.2884 percent FGN March 2027 bonds; N127.45 billion for 12.5 percent FGN March 2035 bonds; and N223.82 billion for 12.98 percent FGN March 2050 bonds.

The auction result indicated that a total of N325.80 billion was allotted, comprising N50.81 billion (12.74 percent), N103.90 billion (13.5 percent), and N171.09 billion (13.7 percent) respectively.