CEM REPORT, FINANCE | Two savings bonds have been announced for subscription by the Debt Management Office (DMO) for 2023.
One is a two-year FGN savings bond due on January 11, 2025, at the interest rate of 9.600% per annum.
The other is a three-year FGN savings bond due on January 11, 2026, at the interest rate of 10.600% per annum.
The announcement contained in a statement by the DMO on Monday noted that bonds were backed by the full faith and credit of the Federal Government and charged upon the general assets of the country.
According to the statement, the the opening date for investment in the bonds would be January 3, the closing date would be January 6, and the settlement date, be January 11, while coupon payment dates would be April 11, July 11, October 11 and January 11, 2024.
“They are offered at N1,000 per unit subject to a minimum subscription of N5,000 and in multiples of N1,000 thereafter, subject to a maximum subscription of N50 million.
“Interest is payable quarterly while bullet repayment (principal sum) is on maturity.”
The DMO said that FGN savings bonds qualified as securities in which trustees could invest under the Trustee Investment Act.
“They also 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.
“They are listed on the Nigerian Stock Exchange Limited and qualify as liquid assets for liquidity ratio calculation for banks.”
The Federal Government saving bonds is the first issuance for 2023.