On behalf of the Federal Government of Nigeria (FGN), the Debt Management Office (DMO) has listed four FGN bonds worth N360 billion for auction.
The initial offer was a February 2028 FGN bond valued at N90 billion with an interest rate of 13.98% per year, according to the DMO’s announcement of the bond auction (10-year re-opening).
The second is a N90 billion April 2032 FGN bond with an annual interest rate of 12.50 percent (10-year re-opening)
Additionally, there is a N90 billion April 2037 FGN bond with a 16.24% annual interest rate (20-year re-opening).
The fourth offer is an April 2049 FGN bond, also valued at N90 billion, at an interest rate of 14.80 percent per annum (30-year re-opening).
It announced that the auction date is Feb. 13, while the settlement date is Feb. 15.
According to the DMO, for the re-opening of previously issued bonds, successful bidders will pay the price corresponding to the yield-to-maturity bid that clears the volume being auctioned plus any accrued interest on the instrument.
“Interest is payable semi-annually, while bullet repayment (principal sum) is on the maturity date.
“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.
“They qualify as securities in which trustees can invest under the Trustee Investment Act.
“They also qualify as government securities within the meaning of the Company Income Tax Act and Personal Income Tax Act for tax exemption for funds among other investors.
“They are listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange,’’ the DMO said.
It said that all FGN bonds qualify as liquid assets for liquidity ratio calculation for banks.
