The Debt Management Office (DMO) has revealed that the Federal Government intends to raise N2.5 trillion in its upcoming bond auction, marking its second issuance of the year.
In a circular released on Wednesday, the DMO outlined the details of the offerings, consisting of two tranches: one with a maturity date of February 2031, amounting to N1.25 trillion, and another with a maturity date of February 2034, also valued at N1.25 trillion. These bonds are part of the Federal Government’s domestic borrowing plan, conducted through its FGN savings bonds.
“The Debt Management Office on behalf of the Federal Government of Nigeria offers for subscription by auction and is authorized to receive applications for N1,250,000,000,000.00 FGN FEB 2031 (7-Yr NEW) and N1,250,000,000,000.00-FGN FEB 2054 (10-Yr NEW),” the circular stated.
The auction is scheduled for February 19, 2024, with settlement expected on February 21, 2024.
Last year, the Federal Government raised approximately N7.06 trillion from the fixed-income market. This year, it aims to surpass that figure, projecting new borrowings to reach N7.83 trillion.
The newly offered FG bonds have a face value of N1,000, with a minimum subscription requirement of N50,001,000 and subsequent increments in multiples of N1,000. Interest payments on FGN bonds are typically made semi-annually.
In January, the Federal Government issued two-year and three-year FGN Savings bonds at interest rates of 11.033% and 12.033% per annum, respectively, totaling N603.42 billion and N1.394 trillion in allocations.
