The Federal Government of Nigeria (FGN), through the Debt Management Office (DMO), has announced an offer for subscription by auction, aiming to raise N350 billion through the issuance of Federal Government Bonds.
This amount is less than a total of N450 billion offered in the previous month during the January 2025 FGN bond auction.
The auction, scheduled to take place on February 24, 2025, will consist of the reopening of two previously issued bonds.
These include the 19.30% FGN April 2029 bond, with a total offer size of N200 billion, and the 18.50% FGN February 2031 bond, with a total offer size of N150 billion. The settlement date for successful bids is set for February 26, 2025.
This issuance is part of the government’s ongoing strategy to raise long-term funds to support national expenditure and stimulate economic development.
By reopening these bonds, the government provides investors with another opportunity to participate in a secure and structured investment vehicle while managing its debt obligations efficiently.
The bonds qualify as government securities under Nigerian tax laws, making them attractive to a wide range of investors. Under the Company Income Tax Act (CITA) and the Personal Income Tax Act (PITA), these bonds are eligible for tax exemptions for pension funds and other qualified institutional investors.
This tax advantage enhances the appeal of FGN Bonds, particularly for long-term investors seeking stable returns with minimal tax liabilities.
This backing ensures that investors face minimal credit risk, as the government is obligated to honor both interest payments and principal repayment upon maturity.
Investors interested in participating in this bond auction can do so through any of the Primary Dealer Market Makers (PDMMs) authorized by the DMO.
These include major financial institutions such as Access Bank, First Bank of Nigeria, Stanbic IBTC Bank, Citibank Nigeria, Guaranty Trust Bank, Zenith Bank, and several others.
These institutions act as intermediaries, facilitating investor participation in the auction process.