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FG hopes to borrow N450 billion from FGN Bond auction in March 

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FGN Bonds

The Federal Government seeks to borrow N450 billion from its third FGN bond auction of 2024, according to the latest circular from the Debt Management Office (DMO). 

This figure is 82% less than the N2.5 trillion target from the same bond auction in the previous month. 

According to the circular seen by ThePressNG, the auction is set for March 18, 2024, with a settlement date of March 20, 2024. 

Investors will purchase these bonds at a price corresponding to the yield-to-maturity bid that clears the auction volume and any accrued interest. 

These bonds, being crucial instruments for the government’s debt management strategy, serve multiple purposes, including providing investors with a relatively safe investment option, assisting in managing the country’s debt profile, and facilitating efficient fund management. 

The offer states that the units of sale will be at N1,000 per unit, with a minimum subscription of N50,001,000, and subsequent subscriptions in multiples of N1,000. The interest on these bonds is payable semi-annually until maturity, where a bullet repayment is scheduled. 

Notably, the FGN bonds carry the full faith and credit of the Federal Government of Nigeria, making them a secure investment. They are charged upon the general assets of Nigeria and are listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange. 

Also, these bonds qualify as securities in which trustees can invest under the Trustee Investment Act, are recognised as government securities within the meaning of Company Income Tax Act (CITA) and Personal Income Tax Act (PITA) and qualify as liquid assets for the calculation of liquidity ratio for banks. 

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