BREAKING: FG issues $500 million five-year domestic dollar bond at 9.75%

The Nigerian government has announced the issuance of a $500 million five-year domestic dollar bond, opening for subscription on August 19, 2024.

The bond offers a competitive interest rate of 9.75%, aimed at attracting both local and international investors.

The bond issuance is part of the government’s ongoing efforts to diversify its funding sources and provide investment opportunities in the domestic market.

The auction for this bond will remain open until August 30, 2024, allowing investors a sufficient window to participate in this offering.

Structured as a five-year investment, the bond features semi-annual coupon payments, providing investors with a steady income stream over the investment period.

Investors have the opportunity to purchase units at a minimum of $1,000 each, with the initial minimum subscription set at $10,000 (equivalent to 10 units). Subsequent investments can be made in multiples of $1,000, offering flexibility for investors looking to adjust their portfolios.

At the end of the five-year term, the bond will be redeemed through a bullet repayment, ensuring that investors receive their principal in full upon maturity.

This structure provides investors with a clear exit strategy and a guaranteed return on their initial investment.

The issuance of this bond comes at a time when Nigeria is looking to bolster its foreign exchange reserves and manage its debt obligations more effectively.

By offering a dollar-denominated bond domestically, the government aims to attract foreign currency into the country while providing a secure investment option for those looking to invest in U.S. dollars within the Nigerian market.