DMO Offers N800bn in FGN Bonds for Subscription

The Debt Management Office has announced the offer of three Federal Government of Nigeria bonds valued at N800 billion for public subscription, with each unit priced at N1,000.

In a statement issued on February 17, the DMO said the offer includes a N400 billion bond with a 17.95 percent annual coupon, maturing in June 2032. This is a reopening of a previously issued seven-year bond.

Also on offer is a N300 billion bond at 19.89 percent interest, due in May 2034, alongside a N100 billion bond carrying a 19 percent coupon rate and maturing in February 2034. Both are reopenings of existing 10-year instruments.

“Units of sale is N1,000 per unit subject to a minimum subscription of N50,001,000 and in multiples of N1,000 thereafter,” the DMO stated.

The agency explained that successful bidders for reopened bonds will pay a price based on the yield-to-maturity that clears the auction volume, in addition to any accrued interest.

Interest payments will be made semi-annually, while the principal will be repaid in full at maturity.

According to the DMO, the bonds qualify as trustee investment securities under the Trustee Investment Act and are recognized as government securities under the Company Income Tax Act and Personal Income Tax Act, making them tax-exempt for pension funds and certain other investors.

The instruments are listed on both FMDQ OTC Securities Exchange and Nigerian Exchange Limited. The DMO added that all FGN bonds qualify as liquid assets for banks’ liquidity ratio calculations.

The bonds are backed by the full faith and credit of the Federal Government of Nigeria and are charged upon the general assets of the country.

The agency advised interested investors to contact authorized dealers for participation, noting that it reserves the right to allot bonds at its discretion.

Now, stepping back a little. These yields are high. On paper, they look attractive, especially in a high-interest environment. But high yields usually reflect broader economic conditions, inflation pressures, fiscal realities. So while institutional investors may move in quickly, retail participants should pause and think about liquidity, inflation risk, and opportunity cost.