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With common investors expected to take stake in bond investment, the Nigerian Stock Exchange yesterday admitted the Series 1 of the Federal Government of Nigeria (FGN) Savings Bond to the trading floor of the market, maturing March 2019.
The Savings Bond was opened to investing public by way of offer for subscription over a 5 day offer period starting from Monday, March 13, 2017 to March 17, 2017 and N2, 067, 961, 000 was raised from the retail market at 13.01 percent coupon.
The FGN Savings Bond was listed on NSE’s Retail Bond Market.
According to Director General DMO, he said while the bond issuance is specifically targeted at the common investors in the domestic economy, “its benefits amongst others is to help enhance the savings culture among Nigerians while providing all citizens irrespective of income level, an opportunity to contribute to National Development; as well as the comparatively favourable returns available in the Capital market. The FGN Savings Bond is safe and backed by the full faith and credit of the Federal Government of Nigeria, with quarterly coupon payments to bondholders. An interested investor needs to approach any of the accredited brokers and require only the sum of N5, 000 to subscribe with additions in multiple of N1, 000 subject to a maximum amount of N50milliom”, he added.
However, stock broker in a separate meeting with the DMO team to review activities on the series 1 saving bond, called for extension of submission date by one additional day. Because according to them the day of submission after the 5 days allowed is too short in other to avoid rushing. While they urged DMO to address some of the initial challenges, they also suggested an increase on the coupon to attract more investors.
Commenting on the listing, Oscar Onyema, DG NSE, said “we are pleased to list the series 1 of this innovative investment offering that caters to the retail segment of the Nigerian Capital Market. The off take of the first tranche underpins the efforts of the Federal Government to continue to work with stakeholders to deepen the Capital Market whilst delivering value to investors at all income levels. We look forward to continue the collaboration with DMO to list subsequent series of the Savings Bond”.
The DG of the DMO was hosted to a closing gong ceremony to commemorate the listing. Thereafter, he met with stockbrokers to review activities on the series 1 savings bond and thank them for their support on the initiative. The series 2 of the savings bond will be opened for subscription between April 3 and 7, 2017.
Photo caption:
From Left: Mr. Ayodale Afolabi, Director, Portfolio Development Department, Debt Management Office (DMO); Mr. Oscar Onyema, Chief Executive Officer, The Nigerian Stock Exchange (NSE), Dr. Abraham Nwakwo, Director General, DMO; Mr. Haruna Jalo-Waziri, Executive Director, Capital Markets, NSE and Mr. Abubakar Sani Kolo, Head, Portfolio Development Department, DMO at the Listing of Series 1 of the FGN Savings Bond (N2,067,961,000.00) at the Exchange yesterday.
