The Debt Management Office (DMO) has announced the opening of subscriptions for a N1.2 trillion federal government bond auction, providing investors with an opportunity to participate in three bond offerings scheduled for auction on July 20. The move is part of the government’s ongoing efforts to raise funds through the domestic debt market while offering secure investment options backed by the Federal Government of Nigeria.
According to a circular released by the DMO, the offering consists of three reopened bond issues valued at N400 billion each, bringing the total offer size to N1.2 trillion. Settlement for successful subscriptions is expected to take place on July 22. The bonds are designed to attract both institutional and qualified individual investors seeking stable returns in the current market environment.
The first bond on offer is a 10-year reopening that matures in January 2035 and carries an interest rate of 22.6 percent. The second is a 15-year bond due in June 2038 with an annual interest rate of 15.45 percent, while the third is a long-term 20-year bond carrying a 16.249 percent annual interest rate. These offerings provide investors with multiple maturity options depending on their financial goals and risk preferences.
The DMO stated that the bonds will be offered at N1,000 per unit, with a minimum subscription requirement of N50.001 million and additional purchases available in multiples of N1,000. The agency explained that successful bidders for the reopened bonds will pay a price based on the yield-to-maturity bid that clears the auction volume, in addition to any accrued interest on the securities.
Investors will receive interest payments every six months, while the principal amount will be repaid in full upon maturity. The DMO further highlighted that the bonds qualify as trustee investment assets and enjoy tax exemptions for eligible investors under relevant tax laws. Listed on both the Nigerian Exchange Limited (NGX) and the FMDQ OTC Securities Exchange, the securities are also recognized as liquid assets for banks and remain fully backed by the faith, credit, and assets of the Federal Government of Nigeria.
source: The cable
