By Ayomide Otitoju
The Federal Government is set to raise ₦300 billion from the domestic bond market in May 2025, as it continues to leverage local debt instruments to support economic reforms, sustain public financing, and maintain investor confidence.
The fundraising plan, announced by the Debt Management Office (DMO) on Thursday, represents a 12.5 per cent reduction from the ₦350 billion target in April. Despite the lower offer size, recent auction trends suggest strong investor appetite is likely to continue, with previous bond issuances recording significant oversubscription.
According to the DMO issuance calendar, the May auction will feature ₦100 billion in 5-year notes under the 19.30% FGN APR 2029 bond re-opening and ₦200 billion in 9-year notes under the 19.89% FGN MAY 2033 bond re-opening.
Compared to April’s bond sale, the offering for the 5-year instrument has been halved from ₦200 billion to ₦100 billion, while the offer for the 9-year bond has increased by 33.3 per cent, up from ₦150 billion to ₦200 billion.
Both instruments are re-openings, meaning they carry fixed coupon rates of 19.30% and 19.89% respectively. Investors will bid based on desired yields to maturity, while final allotments will be determined by clearing rates, inclusive of accrued interest where applicable.
The DMO noted that in its last auction, it raised a total of ₦397.9 billion — well above the initial target — reflecting continued confidence in Nigeria’s sovereign debt instruments.
The breakdown of April’s auction showed that the 5-year FGN APR 2029 bond attracted modest interest, with ₦21.13 billion allotted across 13 successful bids. In contrast, the longer-term 9-year FGN MAY 2033 bond saw overwhelming demand, resulting in ₦376.77 billion being allotted from 137 successful subscriptions.
The bond market remains a crucial source of domestic financing for the Federal Government, providing an avenue to manage debt sustainability while funding economic priorities and boosting capital market activity.
Market analysts suggest the current high-yield environment continues to lure investors seeking safe, long-term returns, even as inflation concerns persist. The DMO is expected to maintain its balanced issuance strategy to manage cost and risk within Nigeria’s broader debt portfolio.
