DMO To Auction Another N360bn Bonds After 2 Months
The Debt Management Office (DMO) has called for subscription for four units of N90 billion savings bonds about two months after it offered similar bonds in March.
The DMO in a statement yesterday stated that it was receiving the subscription by auction and called for applications of 1,000 per unit subject to a minimum subscription of N50,001,000 and in multiples of N1,000 thereafter.
It described the four bonds as N90bn with 13.98 per cent interest and 10 years reopening. This was followed by “a N90bn bond which has a 12.50 per cent and would be reopened after 10 years; 20 years N90bn with 12 per cent interest and N90bn with 12.98 per cent interest of 30-year reopening.”
It said the auction date was May 15, 2023, while settlement date would be on May 17, 2023, and interest payment was semi-annually.
“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.”
It added that the bonds qualified as securities in which trustees could invest under the Trustee Investment Act, noting that, “It also 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. It is also listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange. 4. All FGN Bonds qualify as liquid assets for liquidity ratio calculation for banks.”
While stating that the government’s bonds are backed by the full faith and credit of the Federal Government of Nigeria and are charged upon the general assets of Nigeria, there will be bullet repayment on the maturity date.
It, therefore, urged interested investors to contact offices of its major dealers.