The Federal Government has opened application list for two new sovereign savings bonds, the last set of savings bonds to be issued this year.
The Debt Management Office (DMO), which oversees government’s debt issues, is offering two new tranches of the Federal Government of Nigeria Savings Bonds (FGNSBs). The first issuance is a two-year bond with a coupon of 9.091 per cent with a maturity date of December 11, 2021. The second issuance is a three-year bond with a coupon of 10.091 per cent and maturity date of December 11, 2022.
Application lists for the two issues opened Monday December 02, 2019 and will run till Friday, December 06, 2019 while the settlement date is fixed for Wednesday December 11, 2019.
The bonds will be listed on the Nigerian Stock Exchange (NSE) and FMDQ Securities Exchange, which allow bondholders to trade their holdings before maturity.
Minimum subscription to the FGNSB is N5,000 while the bond pays coupon or interest rate on a quarterly basis. The FGNjSB was introduced in 2017 as a mass instrument for nationwide mobilization of savings and investments.
Bondholders will have their holdings credited into their investment accounts at the Central Securities Clearing System (CSCS) within three working days after the closure of application on Friday.
GTI Securities Limited, one of the authorised distribution agents for the FGNSB, noted that the savings bonds would help to deepen national savings culture while providing opportunity to all Nigerians irrespective of income level to contribute to and benefit from national development.
According to the stockbroking firm, FGNSB enables all Nigerians opportunity to participate in and benefit from the favourable returns available in the capital market.
GTI Securities noted that the savings bonds are acceptable as collateral for loans by banks and can be sold for cash in the secondary market before maturity.
“The bond will be listed on the Nigeria Stock Exchange for trading and provides liquidity for investors who want to exit before maturity,” GTI Securities stated.
It noted that the savings bonds are good for savings towards retirement, marriage, school fees and house projects among other targets while assuring on its safety as the bonds are backed by the full faith and credit of the Federal Government of Nigeria.