The latest issuance of Federal Government of Nigeria Savings Bonds has received a warm reception from investors, with total allotments for the April 2024 edition soaring to approximately N4.2 billion.
According to the Debt Management Office, the turnout was robust, with hundreds of investors participating, signaling a high level of confidence in the stability and returns of government-backed securities.
The amount raised in April marks a significant increase of about 45% compared to the previous month. In March 2024, the DMO raised approximately N2.9 billion worth of savings bonds at interest rates of 15.097% and 16.097% for the two-year and three-year bonds respectively.
During the offer period from April 1 to April 5, 2024, investors had the opportunity to subscribe to two bonds: the FGNSB April 2026 and the FGNSB April 2027, with maturity periods of two years and three years respectively.
These bonds attracted substantial interest rates of 17.046% and 18.046% respectively, leading to a spirited bidding process.
The FGNSB April 2026 saw a total allotment of N1.23 billion, while its longer-term counterpart, the FGNSB April 2027, witnessed a more substantial allotment of N2.99 billion.
A total of 558 subscriptions were successful for the 2026 bond, while 952 subscriptions were successful for the 2027 bond, indicating a higher investor preference for the latter.
Settlements for these bonds took place on April 9, 2024, with both offerings scheduled to mature in April of their respective years, 2026 and 2027. Coupon payments will be disbursed quarterly, enhancing their appeal as a stable income source for bondholders.
The success of this bond issuance underscores the healthy investor appetite for Nigerian sovereign debt, reflecting confidence in the nation’s fiscal management and economic policies.
Moreover, the high participation rates and significant allotments demonstrate the market’s liquidity and investor confidence in the stability of Nigeria’s financial instruments.
For both individual and institutional investors, this presents a valuable opportunity to secure attractive interest rates with government-backed security, offering favorable returns and contributing to funding national development projects.
It was earlier reported that the Federal Government, through the Debt Management Office, opened offers for the April 2024 Savings Bond, with interest rates reaching as high as 18.046% per annum. The subscription is open monthly, with a minimum subscription of N5,000 and subsequent multiples of N1,000, up to a maximum subscription limit of N50,000,000.
