FGN savings bond yields slide as October offer opens

The Federal Government has lowered the interest rates on its latest savings bond offer, with investors set to earn 13.071 per cent on the two-year instrument and 14.071 per cent on the three-year bond.

The Debt Management Office announced the rates in its October 2026 offer circular released on Monday.

The new three-year rate represents a decline from the 15.12 per cent offered on the same tenor in September.

The October offer opened on 5 October and will close on 9 October, with settlement scheduled for 14 October.

The latest rates come as the domestic fixed-income market continues to adjust to changing interest rate conditions.

The two-year FGN savings bond, maturing on 14 October, 2028, carries a coupon of 13.071 per cent per annum.

The three-year instrument, due on 14 October, 2029, offers 14.071 per cent annually.

Interest payments on both securities will be made quarterly on 14 January, 14 April, 14 July and 14 October.

The bonds are backed by the full faith and credit of the Federal Government.

Investors have an opportunity to lock in fixed quarterly income through government securities with different maturity periods.

The three-year bond offers a one-percentage-point premium over the two-year instrument.

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The FGN savings bond remains targeted at retail investors seeking access to government securities with relatively low entry requirements.

Each unit is priced at N1,000, while the minimum subscription is N5,000.

Investors can increase their holdings in multiples of N1,000, subject to a maximum subscription of N50m.

The bonds will be redeemed through a bullet repayment at maturity.

They also qualify as government securities under relevant tax laws and eligible investments for trustees under the Trustee Investment Act.

The securities can additionally be recognised as liquid assets for banks when calculating liquidity ratios.

The latest offer comes amid stronger demand for FGN savings bonds during 2026.

Between January and September, allotments reached N47.25bn, according to the available figures.

That represents an increase of N11.02bn compared with the N36.23bn allotted during the corresponding period of 2025.

The increase suggests stronger participation in the retail government securities market despite fluctuations in yields during the year.