From Adanna Nnamani, Abuja
The federal government, through the Debt Management Office (DMO), has announced a fresh N600 billion Federal Government of Nigeria (FGN) bond auction as part of efforts to finance fiscal obligations and deepen the domestic capital market.
The DMO, in an offer circular issued on Tuesday, said the auction is scheduled for May 18, 2026, while successful subscriptions will be settled on May 20, 2026.
According to the agency, the offer consists of two re-opened bond instruments valued at N300 billion each. They include the 22.60 per cent FGN January 2035 10-year re-opening bond and the 16.2499 per cent FGN April 2037 20-year re-opening bond.
The DMO explained that the bonds are being offered at N1,000 per unit, with a minimum subscription of N50.001 million and additional investments allowed in multiples of N1,000.
It noted that since the instruments are re-openings of previously issued bonds, their coupon rates have already been fixed.
Interest payments on the bonds will be made semi-annually, while repayment of the principal will be through a bullet repayment structure at maturity.
The agency further stated that successful bidders would pay based on the yield to maturity that clears the auction, in addition to accrued interest.
The DMO assured investors that the bonds are backed by the full faith and credit of the Federal Government of Nigeria, making them one of the safest investment instruments in the domestic market.
The latest issuance underscores the Federal Government’s continued reliance on the domestic debt market to finance budget deficits, refinance maturing obligations and fund critical infrastructure projects, while reducing exposure to foreign exchange risks associated with external borrowing.
Findings, however, show that the government reduced its bond offer by N100 billion compared with April 2026, when it offered N700 billion across three instruments, including the 2035, 2032 and 2030 bonds.
Analysts said the reduction in the May offer may reflect a more cautious borrowing strategy amid concerns over rising debt service costs, even as improved liquidity conditions and stronger oil prices provide some fiscal relief.
The DMO also highlighted several incentives attached to the bonds to encourage participation by institutional investors.
According to the agency, the instruments qualify as trustee investment securities under the Trustee Investment Act and as government securities under the Company Income Tax Act (CITA) and Personal Income Tax Act (PITA).
It added that pension funds and other eligible investors may benefit from tax exemptions, while the bonds are listed on the Nigerian Exchange Limited and the FMDQ OTC Securities Exchange for secondary market trading.
The bonds also qualify as liquid assets for banks in liquidity ratio calculations.
The DMO advised interested investors to submit applications through approved Primary Dealer Market Makers (PDMMs), including major banks such as Access Bank, First Bank of Nigeria, Stanbic IBTC Bank, Guaranty Trust Bank, United Bank for Africa, Zenith Bank, Ecobank Nigeria and Standard Chartered Bank Nigeria.
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