Federal Government begins sale of 2, 3-year savings bonds

The Federal Government has offered for subscription two-year savings bond at 11.19 percent and three-year savings bond at 12.19 percent per annum, the Debt Management Office (DMO) said.

According to the offer circular obtained from the DMO website, the two-year bond will be due in June 2021, while the three-year bond will be due in June 2022.

It did not state how much was offered, but added that the maximum subscription was N50 million at N1,000 per unit subject to minimum subscription of N5,000 and in multiples of N1,000.

The DMO said that the bond was fully backed by the full faith and credit of the Federal Government with quarterly coupon payments to bondholders.

The savings bond issuance is expected to help finance the nation’s budget deficit.

It is also part of the Federal Government’s programme targeted at the lower income earners to encourage savings and also earn more income (interest) compared to their savings accounts with banks.

The circular said that the offer would close on Friday.