This December 2021, the Federal Government of Nigeria, through the Debt Management Office (DMO), is offering two government bonds worth a total of ₦120 billion through auction. The offering comprises an April 2029 FGN bond worth ₦60 billion, with an interest rate of 19.30% per annum (five-year re-opening), and another February 2031 FGN bond, also worth ₦60 billion, with an interest rate of 18.50% per annum (seven-year re-opening).
The auction is scheduled for December 16, with a settlement date of December 18. The bonds are being offered at ₦1,000 each, with a minimum subscription of ₦50 million and multiples of ₦1,000 thereafter. Interest is payable semi-annually, with repayment of principal at maturity.
These bond issues are a testament to the Nigerian government’s continued efforts to mobilize financial resources to finance its various development programs and projects. By offering these bonds, the government seeks to strengthen its financial position while providing investors with the opportunity to support the country’s economic growth.
It is essential for investors to understand the implications of these bond offerings, particularly in terms of potential returns, associated risks, and financial market stability. Diversifying an investment portfolio with safe assets such as government bonds can provide protection against market fluctuations and ensure stable returns over the long term.
In conclusion, Federal Government of Nigeria bonds represent an attractive investment opportunity for investors seeking to combine safety with returns. By participating in these auctions, investors are not only contributing to the financing of government activities but also supporting Nigeria’s economic growth and development.