The Federal Government, through the Debt Management Office (DMO), has launched a $500 million dollar-denominated domestic bond offer.
This bond, issued at an annual interest rate of 9.75%, has a five-year tenor and will mature in 2029.
Additionally, the government has prohibited prospective investors from making cash payments for this investment.
“Payments must be made exclusively through the banking system and electronic transfers into designated accounts. Cash deposits will not be accepted for this transaction, unless the funds have been in the domiciliary account for at least 30 days prior to the offer date,” according to a statement posted on the DMO’s website on Monday.
Last week, Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, announced that the DMO would be auctioning Series 1 of its first domestic dollar bond, worth $500 million, today.
This dollar bond is the first of its kind in the country, featuring bullet repayment in US dollars at maturity, with full repayment of the principal amount at the end of the five-year term.
According to the statement, eligible investors include Nigerian residents, Nigerian individuals with savings abroad, Nigerians in the diaspora, and Qualified Institutional Investors.
The offer opens on August 19, closes on August 30, and settles on September 6, 2024, giving investors ample time to participate.
The bond is structured as a five-year investment with semi-annual coupon payments.
Investors can purchase units starting at a minimum of $1,000 each, with an initial minimum subscription set at $10,000 (10 units). Subsequent investments can be made in multiples of $1,000.
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