The Director-General of the Debt Management Office (DMO), Ms Patience Oniha, has hinted that about 7,000 investors have subscribed to the Federal Government of Nigeria’s savings bonds since its introduction in March, this year...
Oniha said that one of the reasons for introducing the savings bond was to encourage a savings culture among Nigerians.
She told the News Agency of Nigeria (NAN) in Abuja on Monday that considering that the subscribers are largely retail investors, it meant that the savings bond had provided a vehicle for mobilizing savings.
The DMO boss promised to continue to support the product and attract more subscriptions through investors’ enlightenment.
The bond allotment results obtained from the DMO website showed that in March, N2.068 billion was allotted to 2,575 investors, while in April, N1.2 billion was allotted to 1,798 subscribers.
In May, N790.85 million was allotted to 1,233 subscribers, while in June N607.26 million was allotted to 921 subscribers.
In July, N400.5 million was allotted to 779 investors, while in August there was an upward improvement to N738.14 million allotted to 761 subscribers.
The bond issuance is part of the government’s programme targeted at the lower income earners to encourage them to save and earn more income (interest), compared to their savings accounts with banks.
It was introduced to enable Nigerians benefit from the favorable returns available in the capital market, and to help finance the nation’s budget deficit.
The bonds are debt securities (liabilities) of the Federal Government backed by its “full faith and credit” with interests to be paid at regular periods and principal repaid at maturity.
It has a tenor of between two to three years and a minimum size of investment of N5,000 and maximum of N50 million.
The bond is aimed at deepening the national savings culture; diversifying government’s funding sources and providing opportunity to all citizens, irrespective of income level to contribute to national development.
It is issued through stock broking firms accredited by the DMO to market and distribute it.
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