The Debt Management Office (DMO) will auction four reopening bonds worth N360 billion on behalf of the Federal Government of Nigeria on May 15 2023. This is according to the auction document released by the DMO this week, adding that the settlement date for the auction is May 17, 2023.
The first offer involves a 10-year reopening bond worth N90 billion with an interest rate of 13.98 percent due February 2028. The second offer is another 10-year reopening bond worth N90 billion having a coupon of 12.50 percent due April 2032.
The third offer is a 20-year reopening bond worth N90 billion with an interest rate of 13.00 percent due January 2042 while the fourth offer is a 30-year reopening bond worth N90 billion with an interest rate of 12.98 percent due March 2050.
The minimum subscription, according to the offer document is N50,001,000 and in multiples of N1000 thereafter. Interest on all the four bonds will be paid semi-annually, according to DMO.
In terms of status, the offer document states that the bonds qualify as securities in which trustees can invest under the Trustee Investment Act; qualify as Government securities within the meaning of Company Income Tax Act and Personal Income Tax Act as well as for Tax Exemption for Pension Funds amongst other investors.
The bonds will be listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange, and all FGN Bonds qualify as liquid assets for liquidity ratio calculation for banks.
DMO added that 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, noting that bullet repayment is on the maturity date.
Interested investors are advised to contact commercial and merchant banks in the country for additional information.
