FG Target N200bn Through Bond Auction

The Debt Management Office (DMO) on Thursday announced an offering of N200bn savings bonds.

According to the offer document on its website, one of the bonds was a reopening of the June 2032 bond with the coupon rate of 17.95 per cent.

The new five-year bond, FGN AUG 2030 of N100bn, doesn’t have a coupon rate yet. The auction date for the bonds is Monday, with settlement expected on Wednesday.

The minimum subscription amount is N5,000.00 with additions in multiples of N1,000.00, subject to a maximum of N50m. Interests are paid semi-annually.

Earlier in the month, DMO launched the August 2025 Federal Government of Nigeria savings bonds, offering investors attractive interest rates of up to 15.401 per cent per annum. The bond offering consisted of two options: a two-year savings bond maturing on August 13, 2027, with an interest rate of 14.401 per cent, and a three-year bond maturing on August 13, 2028, with a higher interest rate of 15.401 per cent.

Investors’ appetite for longer-dated bonds has been sustained, as indicated in the July auction result, which showed that a total of 109 bids were received for the FGN June 2032 bond, with 59 bids successful.

The debt office allotted a total of N172.50bn for the June 2032 bond and N13.43bn for the April 2029 bond.

At the auction, DMO said, “Successful bids for the 19.30 per cent FGN APR 2029 (re-opening, five-year bond) & 17.95 per cent FGN JUN 2032 (re-opening, seven-year bond) were allotted at the marginal rates of 15.69 per cent and 15.90 per cent, respectively. However, the original coupon rate of 19.30 per cent for the 19.30 per cent FGN APR 2029 and 17.95 per cent for the 17.95 per cent FGN JUN 2032 will be maintained.”

According to United Capital, some of the benefits of investing in FGN bonds include guaranteed returns if held till maturity, and the minimum investment is as low as N5,000, which encourages financial inclusion among low-income households.

“A competitive interest rate compared to savings accounts. The interest income earned from the securities is exempt (tax-free). The FGNSB certificate can be used as collateral for a loan, and the savings bond is backed by the Federal Government; thus, it can be termed “risk-free”.