DMO: Why We Are Targeting All Nigerians in New FGN Savings Bond

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Ademola Babalola in Ibadan

As a leap towards strengthening the recently launched federal government Economy Recovery Growth Plan, the Debt Management Office (DMO) in Abuja thursday took President Muhammadu Buhari’s campaign for new investment opportunity for all Nigerians to Ibadan, Oyo State capital. It is codenamed ‘Federal Government of Nigeria Savings Bond (FGNSB)’.

The DMO management, at the one-day advocacy and sensitisation workshop on FGN Savings Bond attended by representatives of three major tribes in Nigeria; Hausa, Igbo and Yoruba alongside leaders of unions, associations in the South-west region, spelt out features of the new bonds which had varying benefits like interest on income to be paid quarterly; FGNSB acceptable as collateral for bank loans; and for good savings towards retirement, marriage, school fees, house projects among others.

With features relating to issuing of bonds on monthly basis in tenors of two and three years, and minimum subscription amount of N5,000 with additions in multiples of N1,000 to a maximum of N50million, the DMO said all interested Nigerians can subscribe through stockbroking firms trading with the Nigeria Stock Exchange (NSE) and accredited distribution agents licenced by the DMO.

The Director General of DMO, Dr. Abraham Nwankwo, said the bond would greatly empower every Nigerian economically, adding that the FGNSB is a bond issued by the federal government primarily for retail investors with a view to providing opportunity for investors to contribute to national development as it improves the savings culture in Nigeria.

Nwankwo, who noted that DMO has a board that is always chaired by the vice president of the country, explained that Nigerians can invest a minimum of N5,000 and maximum of N50million in FGNSB, adding that any amount higher than N50million should be invested in the old bond, known as Federal Government of Nigeria Bond (FGNB).

According to him, “We are here in Ibadan to enlighten the public about the Federal Government of Nigeria Savings Bond. The government of President Buhari has an economic philosophy of making sure that the economic process is inclusive. As Nigeria recovers (from economic recession) and grows, nobody should be left behind, which means even Nigerians, no matter their income level will have an opportunity to participate in the process of re-activating the economy, and also benefit from the progress that is being made.

“It is in that regard that the DMO has been mandated by the acting President Yemi Osinbajo to ensure that DMO also works along this mandate. The federal government has been issuing bonds since 2002 and the purpose is to ensure that government raises additional money to augment revenue to be able to fund various capital projects in the budget. The budget is always approved by the National Assembly, which means the National Assembly on behalf of the people of Nigeria takes a decision and approves that money should be borrowed.

“So, we have been using the Federal Government of Nigeria Bond in particular to do the borrowing from domestic sources. We also borrow from external sources. However, based on new philosophy of government, that whatever we are doing should be inclusive, so that when we achieve growth, it will be growth with development because everybody is involved.

“So we have decided to design a new instrument–FGN Savings Bond, which can be accessible to the low income group, such as teachers, artisans, drivers, tomato sellers, market women, plumbers, trade unions and to all types of associations.”