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Nigerian govt to auction N150bn bonds in November

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Nigeria’s Debt Management Office (DMO), has said the Federal Government will offer N150 billion bonds for subscription in November.

The Office which made the disclosure in a circular on its website, said that the bonds consisted of three bonds worth N50bn each.

The bonds are a 10-year re-opening bond to be offered at the rate of 12.50 per cent and mature in January 2026; a 20-year re-opening bond to be offered at 16.2499 per cent and mature in April 2037; and a 30-year re-opening bond to be offered at 12.98 per cent and mature in March 2050.

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The DMO noted that bonds, which will be auctioned on November 17, have a settlement date of November 19.

The units of sale are N1,000 per unit subject to a minimum subscription of N50,001,000 and in multiples of N1,000 thereafter.

On the interest rate, which is payable semi-annually, the DMO said, “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.”

According to the circular, the bonds qualify as securities in which trustees can invest under the Trustee Investment Act, and as a liquid asset for liquidity ratio calculation for banks.

The bonds also qualify as government securities within the meaning of Company Income Tax Act and Personal Income Tax Act for Tax Exemption for Pension Funds amongst other investors. Also, they qualify to be listed on the Nigerian Stock Exchange and FMDQ OTC Securities Exchange.

 

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