The Debt Management Office (DMO) has offered N1.75 trillion bonds for subscription at an auction scheduled for October 19, with interest rates ranging from 15.45 percent to 19 percent per annum.
The DMO announced the offer in a circular detailing three previously issued federal government of Nigeria (FGN) bonds being reopened to investors.
The FGN bonds are fixed-income securities issued by the DMO on behalf of the federal government to raise funds for public spending and other financing needs.
The offer comprises N500 billion 10-year bond at 19 percent interest, N800 billion 10-year bond at 16.79 percent, and N450 billion 15-year bond at 15.45 percent.
The DMO said the settlement date for successful bids is October 21, noting that interest will be paid semi-annually, while the principal will be repaid in a lump sum on their respective maturity dates.
The office said investors bidding for the reopened bonds would pay prices corresponding to their accepted yield-to-maturity bids, alongside accrued interest where applicable.
The circular pegged the unit of sale at N1,000, with a minimum subscription of N50.001 million and additional subscriptions in multiples of N1,000.
The debt office said the securities qualify as investments for trustees under the Trustee Investment Act and as government securities under the Company Income Tax Act and Personal Income Tax Act, subject to applicable provisions.
The agency said the bonds are listed on the Nigerian Exchange Limited and the FMDQ OTC Securities Exchange.
“All FGN bonds qualify as liquid assets for calculating banks’ liquidity ratios,” the circular reads.
The DMO advised interested investors to subscribe through designated primary dealer market makers, including Access Bank, Citibank Nigeria, First Bank of Nigeria, United Bank for Africa, Zenith Bank and Guaranty Trust Bank.
According to the office, other designated dealers include Stanbic IBTC Bank, FBNQuest Merchant Bank, Coronation Merchant Bank, Ecobank Nigeria, First City Monument Bank, Standard Chartered Bank Nigeria, FSDH Merchant Bank and Rand Merchant Bank Nigeria.
The DMO reserved the right to allot the bonds at its discretion.