FG Lists January Savings Bonds

The Federal Government at the weekend listed two new tranches of its Federal Government of Nigeria Savings Bond (FGNSB) on the Nigerian Stock Exchange (NSE), paving the way for investors to trade on the debts.

The two bonds – a two-year bond and a three-year bond, were issued on January 13, 2021.

In the first listing, a total of 18,140 units of a two-year savings bond with a coupon of 2.19 per cent and maturity of January 2023 were listed on the sovereign debt segment of the Exchange.

The government also listed a total of 78,052 units of a savings bond with a tenor of three-year and coupon of 3.19 per cent, which will mature in January 2024. The two bonds were listed at a par value of N1,000 each. The government had raised N18.14 million and N78.05 million through the two and three year bonds.

The two bonds were issued earlier this month as part of the government’s monthly FGNSB issuance calendar. The coupon payment dates for the bonds, which pay interest rate quarterly, are April 13, July 13, October 13 and January 13.

The latest coupons showed considerable improvements in yields on government securities. A similar two-year FGNSB issued in November 2020 and due on November 11, 2022 offered a coupon of 1.759 per cent per annum. The three-year FGNSB issued in November 2020 and due November 11, 2023 offered a coupon of 2.759 per cent.

Traditionally, minimum subscription to the FGNSB, usually offer at N1,000 per unit, is N5,000 or five units and in multiples of N1,000 thereafter, subject to a maximum subscription of N50 million.

The FGNSB was introduced in 2017 as a mass instrument for nationwide mobilization of savings and investments. Minimum subscription to the FGNSB is usually N5,000 while the bond pays coupon or interest rate on a quarterly basis.