The Debt Management Office (DMO), on behalf of the federal government, has opened three bonds for subscriptions worth N1.2 trillion through an auction scheduled for July 20.
The DMO said in a circular announcing the offer that it comprises three re-openings valued at N400 billion each, with settlement scheduled for July 22.
It noted that the first bond available for purchase is a 10-year reopening, maturing in January 2035 at a 22.6 per cent interest rate.
The second, according to the DMO, is a 15-year savings bond due on June 2038, at a 15.45 percent interest rate per year.
The agency said the third offer is a 20-year savings bond due on April 2037 at an interest rate of 16.249 percent per annum.
“Bonds are offered at N1,000 per unit subject to a minimum subscription of N50,001,000 and in multiples of N1,000 thereafter,” 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.”
The DMO also said the interest on the bonds will be paid semi-annually, while the principal will be repaid in full on the respective maturity dates.
The office said the securities qualify as trustee investment assets under the Trustee Investment Act and are eligible for tax exemption under the Company Income Tax Act (CITA) and the Personal Income Tax Act (PITA) for pension funds and other qualified investors.
The agency also said the bonds are listed on the Nigerian Exchange Limited (NGX) and the FMDQ OTC Securities Exchange and qualify as liquid assets for banks’ liquidity ratio calculations.
The debt office said the bonds are backed by the full faith and credit of the federal government and charged upon the general assets of the federation.
