DMO offers N150bn FGN Bond for subscription, 30-yr rate declines

The Debt Management Office (DMO) on behalf of the Federal Government of Nigeria offers a total of N150 billion FGN bonds for subscription by auction in June 2021. The bonds are offered at different interest rates and tenors.

FGN Bonds are backed by the full faith and credit of the Federal Government of Nigeria and are charged upon the general assets of Nigeria.

The DMO offers:

• N50,000,000,000 – 16.2884% FGN MAR 2027 (10-Yr Re-opening)
• N50,000,000,000 – 12.50% FGN MAR 2035 (15-Yr Re-opening)
• N50,000,000,000 – 12.98% FGN JUL 2050 (30-Yr Re-opening) *

Auction Date: June 23, 2021; Settlement Date: June 25, 2021.

Units of sale – N1,000 per unit subject to a minimum subscription of N50,001,000 and in multiples of N1,000 thereafter.

These rates, tenor and amount are in pari passu with May 2021 offering except for the 30-Yr Re-Opening with an interest rate lower than the 14.80% offered for the same tenor in May.

However, the rates are significantly higher than the rates of the 2-year and 3-year FGN Savings Bond offered for June 2021. 

• Read: Details of FG Domestic Debt Stock
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The interests are payable semi-annually, with a bullet repayment of the principal upon maturity.

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 according the DMO.

Bond Status:

1. Qualifies as securities in which trustees can invest under the Trustee Investment Act.
2. Qualifies as Government securities within the meaning of Company Income Tax Act (“CITA”) and Personal Income Tax Act (“PITA”) for Tax Exemption for Pension Funds amongst other investors.
3. Listed on the Nigerian Stock Exchange and FMDQ OTC Securities Exchange.
4. All FGN Bonds qualify as liquid assets for liquidity ratio calculation for banks.

Interested investors should contact offices of any of the following Primary Dealer Market Makers (PDMMs): Access Bank Plc, First Bank of Nigeria Ltd, Standard Chartered Bank Nigeria Ltd, Citibank Nigeria Ltd, First City Monument Bank Plc, United Bank for Africa Plc, Coronation Merchant Bank Ltd, FSDH Merchant Bank Ltd, Zenith Bank Plc, Ecobank Nigeria Ltd, Guaranty Trust Bank Plc, FBNQuest Merchant Bank Ltd, Stanbic IBTC Bank Plc.

Ifunanya Ikueze

Ifunanya Ikueze is an Engineer, Safety Professional, Writer, Investor, Entrepreneur and Educator.