FG Expands Investment Access With Two New Savings Bonds

In a continued effort to diversify Nigeria’s funding sources and deepen retail participation in the financial markets, the Debt Management Office (DMO), on behalf of the federal government, has announced the issuance of two new Federal Government of Nigeria (FGN) Savings Bonds. The move is part of a broader macroeconomic strategy to enhance financial inclusion and stimulate long-term domestic savings culture, especially among small-scale investors.

According to the DMO, the new offerings include a two-year FGN Savings Bond due on June 11, 2027, with an annual interest rate of 16.121 percent, and a three-year bond maturing on June 11, 2028, with a higher interest rate of 17.121 percent. The subscription window runs from June 2 to June 6, while settlement is scheduled for June 11. Interest payments will be disbursed quarterly—on March 11, June 11, September 11, and December 11—providing a reliable income stream for retail investors.

Economically, the offering arrives at a crucial time. With inflation currently exceeding 30 percent and the Central Bank of Nigeria (CBN) maintaining a tight monetary stance, Nigerian households are seeking secure instruments that offer relative capital preservation and stable returns. Although the real interest rate remains negative, the nominal yields on these bonds are among the most attractive in the fixed-income space for retail investors, particularly in a volatile equity and currency environment.

Beyond investor returns, the FGN Savings Bonds serve broader economic objectives. They enable the government to tap into idle funds within the economy without leaning heavily on foreign debt or institutional borrowing. The structure of the bonds—offered at N1,000 per unit with a minimum subscription of N5,000 and increments of N1,000 up to a maximum of N50 million—caters specifically to retail investors who previously lacked access to such secure instruments.

Additionally, the bonds are backed by the full faith and credit of the federal government, making them virtually risk-free from a default standpoint. They qualify as trustee investments under the Trustee Investment Act and enjoy favorable tax treatment under the Company Income Tax Act and Personal Income Tax Act, particularly for pension fund managers and other tax-exempt investors.

Their listing on the Nigerian Exchange further enhances their liquidity and transparency, allowing investors the opportunity to trade or use them to meet regulatory liquidity requirements in the banking sector.

From a policy perspective, the FGN Savings Bond programme continues to be a valuable tool for economic stabilisation and financial market development. It encourages a culture of structured savings, reduces reliance on volatile foreign portfolio inflows, and supports local economic development by funding government expenditures sustainably.