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Business News of Thursday, 18 March 2021

Source: nairametrics.com

FG announces the auction of N150 billion bond in March

The photo used to illustrate the story via Nairametrics The photo used to illustrate the story via Nairametrics

The Debt Management Office (DMO) Wednesday announced that the Federal Government will offer N150bn bonds for subscription in March.

They are a N50 billion 10-year re-opening bond to be offered at the rate of 16.888% that will mature in March 2027, a N50 billion 15- year re-opening bond to be offered at 12.5% that will mature in March 2035, and the third and longest bond which is an N50 billion 25-year re-opening bond to be offered at 9.8% and mature in July 2045.

This disclosure is contained in a circular issued by the DMO on its website showing the breakdown of bonds comprising of 3 bonds worth N50 billion each.

The DMO in its statement said that the bond which has an auction date of March 24, 2021, and a settlement date of March 26, 2021, is to be auctioned at N1,000 per unit subject to a minimum subscription of N50 million and in multiples of N1,000 thereafter.

The DMO also noted that the interest payment is made semi-annually with the redemption expected to be a bullet repayment on the maturity date.

What you should knowIt can be recalled that the DMO had earlier disclosed that the Federal Government’s bonds for February worth N150bn were oversubscribed by N39.51bn.The total subscription received from investors for the bonds was N189.51bn, comprising of N77.05bn for 16.2884% FGN March 2027 bonds, N72.33bn for 12.5% FGN March 2035 bonds and N40.13bn for 9.8% FGN July 2045 bonds.The auction result showed that out of the 78, 53 and 60 total bids for the tenures, 31, 20 and 30 bids were successful.The DMO stated that a total of N80.55 billion was allotted comprising of N33.62 billion, N28.9 billion and N18.03 billion.