KEY POINTS
- The Debt Management Office missed two coupon payments on savings bonds in two months.
- The delay is caused by system and processing problems, per the Director-General.
- Efforts are underway to resolve issues and complete all pending payments.
Due to persistent system and processing problems, the Federal Government, acting through the Debt Management Office, has been unable to pay the coupons on two savings bonds.
This has caused the office to miss two coupon payments in a span of two months.Â
According to a Bloomberg article, the government raised N4.2 billion in June by using two- and three-year debt instruments, and the first coupon payment was supposed to be made on September 12, 2024, but it hasn’t been paid.
DMO attributes delay to system and procedural problems
According to a report by Punch, the DMO’s Director-General, Patience Oniha, explained the delay in the report by saying that system and procedural problems are “being addressed.”
When Bloomberg questioned her on Friday, she responded, “I expect an outcome today.”Â
It also stated that holders of other savings bonds reported receiving their coupon payments late in August by a week, which was the first delay they had encountered since the bonds’ launch seven years prior.Â
Hannah Momodu, the Head of Publicity for the DMO, acknowledged the problem when approached for more information, but she also promised that it would be fixed today.Â
DMO promises resolution of network and processing issues
“Sincerely, we are experiencing major system and processing issues which have affected payments this month,” she responded in a chat.Â
“Although we have been able to process some subscriber payments, the system issues we are actively working to fix have sadly caused us to do so in batches.
“We are working tirelessly to resolve any network or processing issues as soon as possible today (Friday).”Â
According to a statement on the debt agency’s website, the DMO sold the notes that were scheduled to pay coupons on September 12 at a rate of 17.4% for the two-year and 18.4% for the three-year period from June 3 to June 7.
Quarterly coupon payments are planned for September, December, March, and June 12th.Â
The 2017 introduction of the savings bond sought to provide retail investors with an option to earn income by investing in government securities, while also diversifying Nigeria’s borrowing sources.
The principal objective of these bond offerings is to raise a substantial amount of money to fund the government’s programs for infrastructure development and fiscal policies.
