Nigeria’s Federal Government raised approximately ₦5.08 trillion through domestic bond auctions in the first half of 2026, representing a 77.8% increase from the ₦2.86 trillion raised during the corresponding period of 2025, according to an analysis of Debt Management Office (DMO) auction results.
The higher borrowing reflects the government’s continued reliance on the domestic debt market to finance budgetary obligations as it seeks to meet fiscal funding requirements.
Despite the larger issuance programme, investor demand remained strong. Total subscriptions reached about ₦9.04 trillion in the first six months of the year, more than double the ₦4.37 trillion recorded in the same period of 2025. Competitive bids also increased significantly to ₦4.95 trillion from ₦1.85 trillion a year earlier.
However, the subscription-to-offer ratio moderated to 182.6% from 236.1% in H1 2025, reflecting the government’s larger volume of bond offerings during the period.
Borrowing costs also eased compared with the previous year. Marginal rates at the auctions ranged between 15.50% and 18.35%, lower than the 17.75% to 22.60% recorded during the first half of 2025, indicating sustained demand for Federal Government securities despite Nigeria’s relatively tight monetary policy environment.
The 22.60% FGN January 2035 bond, referring to its coupon rate, was among the most actively subscribed instruments during the period. The bond was reopened across multiple auctions, attracting cumulative subscriptions of roughly ₦2.3 trillion, while total allotments amounted to approximately ₦1.52 trillion, based on DMO auction data.
January recorded the highest monthly borrowing, with total allotments of about ₦1.68 trillion, compared with ₦601.04 billion in January 2025. June followed with ₦1.22 trillion in allotments, while May recorded ₦894.51 billion, including ₦280 billion allotted through the non-competitive window, which enables eligible institutional investors, including pension funds, to purchase bonds at the auction’s stop rate.
Analysts say the sustained demand underscores the appetite of domestic institutional investors, including pension fund administrators, commercial banks and insurance companies, for government securities, which continue to offer attractive returns.
Market participants expect domestic bond yields to remain relatively elevated in the coming months as investors assess inflation trends, monetary policy decisions and the Federal Government’s financing programme for the rest of the year.
