DMO To Auction N150bn Bond

The Debt Management Office (DMO) is set to auction N150 billion
federal government bonds to investors on Wednesday, June 23,
2021.

DMO made the disclosure in a circular published on its website
at the weekend.

According to the agency, the auction comprises three bonds
valued at N50 billion each. It includes a 10-year re-opening bond
to be offered at the rate of 16.2884 percent with a maturity date
of March 2027, a 15- year re-opening bond to be offered at 12.5
percent with a maturity date of March 2035, and a 30-year
re-opening bond to be offered at 12.98 per cent and mature in March
2050.

It noted that the settlement date of the bond auction is June
25, 2021.

DMO added that the unit of sale is N1,000 per unit, subject to a
minimum subscription of N50,001,000 and in multiples of N1,000
thereafter.

It further explained that the interest is payable semi-annually,
with the redemption expected to be in bullet payment on the
maturity date.

For re-openings of previously issued bonds (where the coupon is
already set), the agency specified that successful bidders are
required to pay a price corresponding to the yield-to-maturity bid
that clears the volume being auctioned, plus any accrued interest
on the instrument.

The DMO said that all federal government bonds qualified as
liquid assets using liquidity ratio for banks as calculation.

It further assured investors that FGN Bonds are backed by the
full faith and credit of the federal government of Nigeria and are
charged upon the general assets of Nigeria.

In May, the DMO had offered three federal government bonds
valued at N50 billion each for subscription by auction.

The Debt Management Office (DMO) is set to auction N150 billion
federal government bonds to investors on Wednesday, June 23,
2021.

DMO made the disclosure in a circular published on its website
at the weekend.

According to the agency, the auction comprises three bonds
valued at N50 billion each. It includes a 10-year re-opening bond
to be offered at the rate of 16.2884 percent with a maturity date
of March 2027, a 15- year re-opening bond to be offered at 12.5
percent with a maturity date of March 2035, and a 30-year
re-opening bond to be offered at 12.98 per cent and mature in March
2050.

It noted that the settlement date of the bond auction is June
25, 2021.

DMO added that the unit of sale is N1,000 per unit, subject to a
minimum subscription of N50,001,000 and in multiples of N1,000
thereafter.

It further explained that the interest is payable semi-annually,
with the redemption expected to be in bullet payment on the
maturity date.

For re-openings of previously issued bonds (where the coupon is
already set), the agency specified that successful bidders are
required to pay a price corresponding to the yield-to-maturity bid
that clears the volume being auctioned, plus any accrued interest
on the instrument.

The DMO said that all federal government bonds qualified as
liquid assets using liquidity ratio for banks as calculation.

It further assured investors that FGN Bonds are backed by the
full faith and credit of the federal government of Nigeria and are
charged upon the general assets of Nigeria.

In May, the DMO had offered three federal government bonds
valued at N50 billion each for subscription by auction.