FGN Savings Bond – The Debt Management Office (DMO) of Nigeria, in line with the Debt Management Office (Establishment) Act 2003 and the Local Loans (Registered Stock and Securities) Act, CAP. LI7, LFN 2004, is offering a unique investment opportunity on behalf of the Federal Government of Nigeria.
The Federal Government Savings Bonds provide an attractive avenue for both individual and institutional investors to grow their wealth securely. In this article, we will explore the key details of this investment opportunity and why it’s worth considering.
Attractive Interest Rates and Quarterly Payments
With interest rates of 12.464% per annum for the 2-year FGN Savings Bond due November 15, 2025, and 13.464% per annum for the 3-year FGN Savings Bond due November 15, 2026, investors can enjoy secure and competitive returns on their investments. Quarterly payments ensure a steady stream of income, allowing investors to plan their finances effectively.
Interest rate Summary
The Federal Government Savings Bonds offer two distinct options with competitive interest rates:
- 2-Year FGN Savings Bond due November 15, 2025: This option offers an annual interest rate of 12.464%.
- 3-Year FGN Savings Bond due November 15, 2026: Investors can choose this option, which provides an annual interest rate of 13.464%.
- Opening Date: November 6, 2023
- Closing Date: November 10, 2023
- Settlement Date: November 15, 2023
- Coupon Payment Dates: Quarterly payments on February 15, May 15, August 15, and November 15.
Key Features of the FGN Savings Bond
- Minimum Subscription: N5,000
- Maximum Subscription: N50,000,000
- Interest Payment: Quarterly
- Redemption: Bullet repayment on the maturity date
- Tax Exemption: Interest income is exempt from Personal Income Tax (PIT) and Capital Gains Tax (CGT)
- Listing: Listed on The Nigerian Exchange Limited (NGX)
- Liquidity: Qualifies as a liquid asset for liquidity ratio calculation for banks
- Security: Backed by the full faith and credit of the Federal Government of Nigeria
Why Should I Invest in the FGN Saving Bonds?
- Trustworthy Investment: The Federal Government Savings Bonds qualify as securities in which trustees can invest under the Trustee Investment Act, offering a level of trust and security for your investment.
- Tax Benefits: These bonds are classified as Government securities under the Company Income Tax Act (“CITA”) and Personal Income Tax Act (“PITA”). This means tax exemption benefits for Pension Funds and other investors, making them an attractive option for long-term investment.
- Listed on The Nigerian Exchange Limited: The bonds are listed on the Nigerian Exchange Limited, providing liquidity and ease of trade for investors.
- Liquidity Ratio Calculation for Banks: The bonds qualify as liquid assets for liquidity ratio calculations for banks, which adds to their appeal as a secure investment option.
- Backed by the Federal Government: The bonds are backed by the full faith and credit of the Federal Government of Nigeria and charged upon the general assets of Nigeria, ensuring your investment is in safe hands.
Support National Development While Earning Attractive Returns
By investing in FGN Savings Bonds, you not only secure your financial future but also contribute to the economic growth and development of Nigeria. Your investment will be used to finance critical infrastructure projects, education, healthcare, and other essential services that benefit all Nigerians.
How to Invest in the FGN Savings Bonds 2023
To invest in FGN Savings Bonds, please contact any of the stockbroking firms appointed as Distribution Agents by the Debt Management Office. A comprehensive list of Distribution Agents can be found on the DMO website at www.dmo.gov.ng.
Your investment will begin generating returns on Feb 15, 2024, with quarterly payments. To invest, please get in touch with your stockbroker. If you don’t have one, don’t hesitate to reach out to any of the stockbrokers listed at this link: https://www.dmo.gov.ng/fgn-bonds/savings-bond/3597-updated-list-of-distribution-agents-as-at-june-16-2021/file
Investing in the Federal Government Savings Bonds is not only a sound financial decision but also a way to contribute to the growth and stability of Nigeria’s economy. With competitive interest rates, tax benefits, and the backing of the Federal Government, these bonds are a compelling choice for investors seeking financial growth while ensuring security for their hard-earned money.