Domestic borrowing: FG offers new retail savings bond

The Debt Management Office (DMO) has opened bidding for a new two-year savings bond targeted at retail investors.

According to DMO, the savings bond which carries a coupon of 13.01 percent, will help broaden the funding base for 2017 budget.

DAILYPOST gathered that the retail bond will be available for purchase on a monthly basis and have a maximum subscription of 50 million naira.

The bond will pay interest quarterly with a bullet repayment for principal at maturity. The initial offer will close on March 17.

The National Budget Office had forecasted that Nigeria will have a budget deficit of 2.36 trillion naira in 2017, half of which it aims to fund through domestic borrowing.

Outstanding local debt rose to 13.88 trillion Naira last year from 8.83 trillion naira in 2015 and is set to increase further, as the economy grapples with its first recession in 25 years, allegedly caused by low oil prices.

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