DMO offers two FGN savings bonds for subscription at N1,000 per unit

By Abubakar Yunus Ojima-Ojo

The Debt Management Office (DMO) has announced an offering for two federal government of Nigeria (FGN) savings bonds for subscription at N1,000 per unit.
The FGN savings bond offer is tailored and targeted at retail investors with guaranteed quarterly interest payment and repayment of the principal at maturity.
In a statement on Monday, DMO said the offers, opened on January 8, 2024, will close by January 12, 2024.
They are the first issuance in the year.

Providing more details on the investment opportunity, the agency said the first offer is a two-year savings bond due to mature on January 17, 2026, at 11.033 percent per annum.
The second issuance, DMO said, is a three-year savings bond due to mature on January 17, 2027, at an interest rate of 12.033 percent per annum.
The organisation said the settlement date is January 17, and coupon payment dates are made quarterly (April 17, July 17, October 17 and January 17, 2025).
“They are offered at 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 million,” DMO said.
“Interest is payable quarterly while bullet repayment is made on the maturity date.”
The savings bonds, like all other government securities, are backed by the full faith and credit of the federal government and charged upon the general assets of Nigeria.
They also qualify as securities in which trustees can invest under the Trustees Investment Act, DMO added.
“They qualify as government securities within the meaning of the Company Income Tax Act and Personal Income Tax Act for tax exemption and pension funds, amongst other investors,” the office said.
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.