The Debt Management Office has offered for subscription four federal government bonds for August 2023 via auction.

According to an offer circular released by DMO, the first is an April 2029 bond valued at N90 billion at an interest rate of 14.55 per cent per annum (10-year reopening).

The second offer is a June 2033 bond valued at N90 billion at an interest rate of 14.70 per cent per annum. (10-year reopening). There is also the June 2038 FGN bond valued at N90 billion, at an interest rate of 15.45 per cent per annum (15-year reopening).

The last offer is the June 2053 bond, valued at N90 billion, at an interest rate of 15.70 per cent per annum (30-year reopening). They are offered at N1,000 per unit subject to a minimum subscription of N50 million and in multiples of N1,000 thereafter.

According to DMO, for reopenings of previously issued bonds (where the coupon is already set), 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.

It stated that interest is payable semi-annually while the bullet repayment (principal sum)will be made on the maturity date. It assured that FGN bonds are backed by full faith and credit of the federal government and are charged upon the general assets of Nigeria.

“They qualify as securities in which trustees can invest under the Trustee Investment Act. They qualify as government securities within the meaning of the Company Income Tax Act and Personal Income Tax Act for tax exemption for pension funds amongst other investors,” stated DMO.

It added, “They are listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange. All FGN bonds qualify as liquid assets for liquidity ratio calculation for banks.”  

(NAN)