The Debt Management Office (DMO) has announced the commencement of the FGN Savings Bond offer with a minimum investment of N5,000 only.
The FGN Bonds are debt securities (liabilities) of the Federal Government of Nigeria (FGN) issued by the Debt Management Office for and on behalf of the Federal Government of Nigeria, which has an obligation to pay the bondholder the principal and agreed interest as and when due.
This means that, when you buy FGN Bonds, you are lending to the FGN for a specified period of time. The FGN Bonds are considered as the safest of all investments in domestic debt market because it is backed by the ‘full faith and credit’ of the Federal Government, and as such it is classified as a risk free debt instrument.
While making the announcement on Monday via DMO’s X handle @DMONigeria, the office assured Investors in the bond to “reap attractive returns”.
The DMO said: “Remember, the larger your subscription, the higher your potential earnings.
“Offer opens today [Monday] and closes on Friday, Nov 10, 2023.”
According to the DMO, the investment will be mature in the first quarter of 2024.
“Your investment will begin generating returns on Feb 15, 2024, with quarterly payments.
“To invest, please get in touch with your stockbroker.” the DMO advised.
What does the government use the investment for?
One, to finance government deficits in a non-inflationary and sustainable manner and to enhance fiscal discipline and for the management of monetary policies
The FGN bond is also used to restructure the existing debt stock of short term debt to longer term obligations and to establish a benchmark yield curve, which acts as a reference for pricing other bonds issued by other bodies.
The DMO also claimed that the bond is used to develop the domestic bond market on a sustainable basis and to enhance and deepen the savings and investment opportunities.
How to Start?
Check out the list of stockbrokers names, emails, phone numbers and addresses here as released by the DMO. They can help you out.