April 3, 2017/InvestmentOne Research
The Federal Government of Nigeria, through the Debt Management Office(DMO), had on the 13th of March 2017 issued the first series of the monthly 2year and 3year tenured savings bond. This bond has a quarterly payment of interest at a coupon rate of 13.01% and has been listed on the floor of the NSE for trading.
The next series of this issue will be coming up between the 3rd and 7th of April 2017 and Investment One Stockbrokers Int’l Ltd as a Distribution Agent (DA) for the bond, shall be receiving applications from the investing public starting from the 3rd of April 2017.
What are Savings Bond ?
Savings bonds are debt instruments offered by government with the aim of mobilizing resources from the general public
The rationale behind the issuance of the savings bond by the FGN is to deepen the national savings culture, to diversify funding sources for the government and establish benchmark for other issuers.
Features;
- Minimum subscription Amount: N5,000.00 (additional investments in multiples of N1,000.00) and maximum of N50,000,000.00.
- The product will be issued monthly in tenors of 2 and 3 years, with quarterly interest payment.
- The bond will be listed on the Nigerian Stock Exchange to guarantee liquidity.
- The product will be offered to the investing public through offer for subscription at an interest rate to be determined by DMO.
Benefits;
- Guaranteed return and encourage financial inclusion among low income household.
- Income from investment are exempted from tax.
- Investment can be used as collateral for loan.
- Attractive coupon above average bank savings rate.
- Steady means of Income as coupon is paid quarterly.
