The Federal Government of Nigeria has concluded arrangements to launch its first-ever savings bonds into the domestic bond market next month, providing the retail investing public opportunity to invest in sovereign bond issue for as low as N5,000.
Market sources and parties to the savings bonds, to be known as Federal Government of Nigeria Savings Bond (FGNSCB), said the issuance of the savings bond could start next month as the government and its professional parties have concluded the pre-offer process for the bond.
The savings bond will bear all the regular features of a national bond, including the zero default rate of a sovereign issuance, fixed coupon or interest rate, privileges and exemptions from certain taxes and levies, as outlined by the Central Bank of Nigeria (CBN), Federal Inland Revenue Services (FIRS) and other government ministries, departments and agencies (MDAs).
The Debt Management Office (DMO), which oversees issuance of Federal Government bonds, will be issuing the savings bonds on behalf of national government.
A copy of the issuance documents obtained at the weekend by The Nation indicated that the FGNSB is deliberately targeted at the lower income earners as part of government’s plan to encourage savings and also earn more income from their savings compared with savings accounts with banks.
The bonds will be issued with a tenor (period) of between two to three years and a minimum size (amount that can be purchased) of investment of N5,000 and maximum of N50 million.
The interest rate, which will be fixed, will be paid quarterly, enhancing the attraction of the savings bond as grassroots instrument for the general public.
The attractions of the savings bonds, according to the issuance documents, included guaranteed returns, competitive fixed interest rate, tax exemption for the interest incomes and collateral for loans.
The retail savings bonds will, in addition, encourage financial inclusion among low income households and enable the public to enjoy those benefits which accrue to high net-worth investors in the capital market.
read the rest here: : http://thenationonlineng.net/fed-govt-sell-n5000-savings-bond-public/
Editors Note: The good thing about sovreign bonds is that they are guaranteed investments. This means that unless the world suddenly comes to an end, you will make your profit. Bonds are not
Like pyramid schemes that could suddenly crash, trapping your life savings.
So people, Zikist Movement has shown you the financial light. You can take it to find your financial way.