Victor Ezeja
The Debt Management Office (DMO) has successfully raised ₦136.16 billion through its Federal Government of Nigeria (FGN) bond auction in August 2025.
This auction demonstrated continued strong investor confidence in Nigerian sovereign debt instruments despite a tighter yield environment and ongoing market uncertainties.
Join our WhatsApp ChannelThe auction featured two bond instruments: a new 5-year bond (17.945 per cent FGN AUG 2030) and a re-opened 7-year bond (17.95 per cent FGN JUN 2032), each with an initial offering size of ₦100 billion.
According to the official circular released by the DMO on Tuesday, 26 August, the auction results reflected sustained investor interest in government securities, with total subscriptions reaching ₦268.17 billion—nearly double the amount offered.
This over-subscription pattern aligns with the trend observed in the previous months of 2025, where FGN bonds consistently attracted substantial investor demand due to attractive coupon levels and Nigeria’s need to fund its fiscal obligations while balancing borrowing costs.
The 5-year tenor attracted 70 bids valued at ₦102.36 billion, with allotments of ₦46.01 billion at a marginal rate of 17.945 per cent.
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The new 5-year bond attracted significant investor attention, though with relatively moderate demand compared to the longer-tenored instrument.
The bid rate range was from 12.50 per cent to 21.50 per cent.
Analysts believe that DMO’s decision to allot less than half of the total bids received for this instrument is a strategic approach to debt issuance, possibly aimed at controlling borrowing costs while still meeting substantial funding requirements.
The re-opened 7-year bond recorded stronger investor demand, as 111 bids were submitted, which were worth ₦165.81 billion. However, the DMO allotted ₦90.16 billion at a marginal rate of 18 per cent, with bid rates ranging from 15 per cent to 22 per cent.
The August 2025 auction results represented a moderation in fundraising compared to July 2025, when the DMO raised ₦185.93 billion from two reopened FGN bonds—substantially higher than the August figure despite similar offering sizes.
The July auction featured a 19.30 per cent FGN APR 2029 bond with a 5-year tenor, which attracted ₦39.08 billion in subscriptions, with ₦13.43 billion allotted at a marginal rate of 15.69 per cent, while the JUN 2032 issue drew ₦261.60 billion in subscriptions, of which ₦172.50 billion was allotted at 15.90 per cent.
Victor Ezeja is a passionate journalist with seven years of experience writing on economy, politics and energy. He holds a Master's degree in Mass Communication.
