The Debt Management Office (DMO) has announced the public offering of three Federal Government bonds worth N800 billion. Each bond is price at N1,000 per unit.
In a statement on Tuesday, February 17, the DMO outlined the details of the bonds:
- N400 billion bond: This bond carries an interest rate of 17.95% per annum and will mature in June 2032. It is a seven-year re-opening of a previously issued bond.
- N300 billion bond: Offering a yield of 19.89%, this bond will mature in May 2034. It represents a 10-year re-opening.
- N100 billion bond: This bond has an interest rate of 19% and will mature in February 2034. It is also a 10-year re-opening.
The auction is schedule for February 23, with settlement set for February 25, 2026.
Subscription Details
The bonds are available at N1,000 per unit, with a minimum subscription of N50,001,000. Additional purchases must be in multiples of N1,000.
For re-opened bonds, the DMO explained that successful bidders will pay a price based on the yield-to-maturity bid that clears the auction volume, along with any accrued interest.
Interest and Repayment
Interest on the bonds be paid semi-annually while the principal will be repaid in full at maturity through a bullet payment.
Tax and Investment Benefits
The bonds qualify as securities under the Trustee Investment Act, making them suitable for trustees. They are also recognized as government securities under the Company Income Tax Act (CITA) and the Personal Income Tax Act (PITA). This makes them eligible for tax exemptions for pension funds and certain other investors.
Market Listing and Liquidity
The bonds listed on the Nigerian Exchange Limited and the FMDQ OTC Securities Exchange. Additionally, all Federal Government of Nigeria (FGN) bonds qualify as liquid assets for banks’ liquidity ratio calculations.
Government Backing
The bonds backed by the full faith and credit of the Federal Government of Nigeria and secure by the country’s general assets.
The DMO emphasized that it reserves the right to allocate the bonds at its discretion. Interested investors are advise to contact authorized banks for participation.
