The Debt Management Office (DMO) of Nigeria has unveiled a new opportunity for investors with the launch of two Federal Government of Nigeria (FGN) savings bonds. The bonds, priced at N1,000 per unit, are now open for subscription and will remain available until June 9, 2023, according to a statement released by the DMO on Monday.
The first offering is a two-year FGN savings bond set to mature on June 14, 2025, with an attractive annual interest rate of 10.301 percent. The second issuance is a three-year savings bond maturing on June 14, 2026, offering investors an annual interest rate of 11.301 percent. Coupon payments for both bonds will be made quarterly on September 14, December 14, March 14, and June 14.
Interested investors can purchase the bonds at N1,000 per unit, with a maximum subscription limit of N5,000. Additional subscriptions can be made in multiples of N1,000, up to a maximum of N50 million. The principal amount will be repaid in full upon maturity, while interest payments will be made regularly throughout the bond’s tenure.
The settlement date for the bonds is set for June 14, 2023, providing investors with a convenient timeline for participation. The DMO emphasizes that these savings bonds are backed by the full faith and credit of the Federal Government of Nigeria and are secured against the country’s general assets.
Furthermore, the FGN savings bonds meet the requirements for investment by trustees under the trustee investment act. They also qualify as government securities under the company income tax act (CITA) and personal income tax act (PITA), ensuring tax exemption for investors, including pension funds and other interested parties.
In addition to these advantages, the FGN savings bonds are listed on the Nigerian Exchange Limited, enhancing their liquidity and making them eligible as liquid assets for banks’ liquidity ratio calculations.
The DMO’s latest offering provides individuals and institutions with an opportunity to invest in secure government-backed instruments while enjoying attractive interest rates. By offering these savings bonds, the Nigerian government aims to support savings culture, encourage financial inclusion, and provide a reliable investment avenue for investors across various sectors.
Investors are encouraged to take advantage of this offering before the subscription period ends on June 9, 2023, to benefit from the potential returns and the stability offered by the FGN savings bonds.
Disclaimer: This article is for informational purposes only and should not be considered as financial advice. Potential investors are advised to conduct their own research and consult with a financial professional before making any investment decisions.