DMO auctions 4 FGN bonds worth N360bn in March
March 16, 2023128 views0 comments
By Cynthia Ezekwe
The Debt Management Office (DMO) has offered four Federal Government of Nigeria (FGN) Bonds valued at N360 billion for subscription through auction in March 2023.
According to the DMO, the first offer is a February 2028 FGN bond valued at N90 billion ,a 10-year re-opening, at an interest rate of 13.98 per cent per annum.
The second offer is the April 2032 FGN bond valued at N90 billion, a 15-year re-opening, at an interest rate of 12.50 per cent per annum.
The third offer is the April 2037 FGN bond valued at N90 billion, a 20-year reopening,at the rate of 16.2499 per cent per annum; while the fourth offer is the April 2049 FGN bond valued at N90 billion, a 30-year reopening, at an interest rate of 14.80 per cent per annum.
According to the DMO, the bonds are offered at N1,000 per unit with a minimum subscription of N50 million, and in multiples of N1,000 thereafter.
“For re-openings of previously issued bonds, 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.,’’ DMO disclosed.
It also noted that interest payment is done semi-annually while the bullet repayment, which is the principal sum, is done on the maturity date, stating that they qualify as securities in which trustees can invest under the Trustee Investment Act.
“They qualify as government securities within the meaning of the Company Income Tax Act (CITA) and Personal Income Tax Act (PITA) for tax exemption for pension funds amongst other investors.They are listed on the Nigerian Stock Exchange Limited and FMDQ OTC Securities Exchange,’’ DMO disclosed.
It added that all FGN Bonds qualify as liquid assets for liquidity ratio calculation for banks