The Federal Government, through the Debt Management Office (DMO), plans to raise N700 billion from the domestic debt market in April 2026, continuing its reliance on local borrowing amid persistently high interest rates.
According to the April 2026 Federal Government of Nigeria (FGN) Bond Offer Circular, the auction is scheduled for April 27, with settlement set for April 29.
The issuance will comprise reopened bonds across three maturities, reflecting a strategy focused on strengthening liquidity in existing instruments rather than introducing new debt tenors.
Under the offer, N300 billion will be raised through the 17.945% FGN August 2030 bond, N100 billion through the 17.95% FGN June 2032 bond, and N300 billion via the 22.60% FGN January 2035 bond.
The structure shows a continued emphasis on longer-dated securities, with the 10-year bond accounting for the largest share of the offer. This approach allows the government to secure longer-term funding while managing refinancing risks over time.
However, the reduced allocation to the 7-year bond suggests cautious investor appetite across parts of the yield curve, as markets continue to weigh inflation risks, currency pressures, and global economic uncertainty.
The bonds will be issued in units of N1,000, with a minimum subscription of N50.001 million, targeting institutional investors such as pension funds, banks, and asset managers.
The DMO noted that the instruments qualify as liquid assets for banks and are exempt from certain taxes under applicable laws, making them attractive in a high-yield environment.
Compared with the March 2026 issuance of N750 billion, the April offer reflects a slight reduction of N50 billion, indicating a modest adjustment rather than a major shift in borrowing strategy.
In March, the DMO offered N250 billion in the 5-year bond, N200 billion in the 7-year bond, and N300 billion in the 10-year bond. In April, the 5-year allocation rises to N300 billion, the 7-year drops to N100 billion, while the 10-year remains unchanged.
The continued use of bond re-openings highlights the government’s effort to deepen liquidity in benchmark securities and improve secondary market activity.
Coupon rates remain elevated, reflecting tight domestic financial conditions. The 10-year bond carries a significantly higher rate of 22.60%, compared to about 19.89% for the similar tenor issued in March.
The widening yield spread underscores investor demand for higher returns amid persistent inflation concerns, exchange rate volatility, and broader macroeconomic uncertainty.
Final yields will be determined through the auction process, where investors submit competitive bids based on desired yield-to-maturity.
The sustained high borrowing costs align with the Central Bank of Nigeria’s tight monetary policy stance aimed at curbing inflation, though it continues to increase the government’s debt servicing burden.
