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LAGOS, March 1 (Reuters) - Nigeria plans to target retail investors with a new savings bond that will go on sale this month, the Debt Management Office said on Wednesday.
Two- and three-year maturities will be offered, with interest paid quarterly. The interest rate has yet to be announced, but the debt office paid 16.5 percent on a five-year bond sold to institutional investors last month.
The bonds will be "good for savings towards retirement, marriage, school fees, house projects," the debt office said.
Savings accounts at Nigeria's commercial banks pay up to 5 percent in interest, but the country's inflation is running at more than 18 percent annually.
The bond offer will open on March 13 and end after five days, the debt office said. New issues will be sold every month. The minimum subscription will be 5,000 naira ($16) and the maximum 50 million naira. Nigeria's government depends on local borrowing to fund more than half its budget deficit, which is expected to reach 2.36 trillion naira this year.
It issued a $1 billion Eurobond last month and is now seeking approval from parliament for an additional $500 million Eurobond. Last week, it said it would offer a 20 billion-naira "green bond" in April.
The government also plans to sell a $300 million diaspora bond abroad this year and its first sovereign sukuk in the local market.
$1 = 305.00 naira Editing by Larry King