The Debt Management Office (DMO) has successfully raised a total of ₦4.3 billion from its May 2025 Federal Government Savings Bond offer, showing sustained interest from retail investors in low-risk fixed income instruments backed by the Federal Government of Nigeria.
The subscription window, which opened on May 5 and closed on May 9, 2025, offered Nigerians two investment options: a two-year bond and a three-year bond. The settlement for all successful subscriptions was scheduled for May 14, 2025.
The two-year bond, which will mature on May 14, 2027, came with a coupon rate of 16.173 per cent per annum. A total of 994 investors successfully subscribed to this offer, leading to an allotment of ₦840.434 million.
On the other hand, the three-year bond, which will mature on May 14, 2028, carried a higher coupon rate of 17.173 per cent. This longer-tenor bond recorded more interest from investors, as 1,537 subscriptions were successful, resulting in an allotment value of ₦3.466 billion.
These savings bonds offer quarterly interest payments, with coupons scheduled for disbursement every year on February 14, May 14, August 14, and November 14, providing regular income to retail investors and encouraging long-term savings habits.
The Federal Government Savings Bond was introduced by the DMO to deepen financial inclusion by attracting small savers into the capital market. It is targeted primarily at retail investors such as individuals, cooperative societies, and small institutions. The bonds are considered a safe investment option since they are backed by the full faith and credit of the Federal Government.
In related developments, the DMO revealed that Nigeria borrowed a total of ₦1.94 trillion from bond investors during the first quarter of 2025 through various bond auctions. This shows the government’s continued reliance on the domestic debt market to fund budget deficits and finance capital projects.
The DMO has also been working on other debt instruments like the Sovereign Sukuk and Green Bonds to diversify the country’s debt profile and attract different investor classes. Recently, it was reported that the Federal Government is targeting ₦300 billion from its Series Seven Sovereign Sukuk to support infrastructure development.
Analysts say the sustained interest in savings bonds is a positive sign that more Nigerians are becoming comfortable with investing in government securities. They also note that the attractive coupon rates offered this month reflect the current interest rate environment and are designed to compete with returns from other investment vehicles.
The Federal Government, through the DMO, has also expressed interest in returning to the JP Morgan Government Bond Index, a move that would boost Nigeria’s visibility to international investors and potentially attract more foreign portfolio inflows.
With macroeconomic challenges such as inflation and exchange rate volatility still affecting the broader economy, instruments like the savings bond provide a relatively stable and predictable return for retail investors who want to preserve capital and earn consistent income.
