The Debt Management Office (DMO), on behalf of the Federal Government, has announced a fresh N600 billion Federal Government of Nigeria (FGN) bond auction for May 2026.
The bond offer is part of the government’s broader strategy to finance fiscal obligations, deepen the domestic capital market, and attract institutional investors amid sustained demand for fixed-income securities.
According to the offer circular issued by the DMO on Tuesday, the auction will be held on May 18, 2026, while successful subscriptions will be settled on May 20, 2026.
The DMO disclosed that the offer consists of two re-opened FGN bond instruments valued at N300 billion each:
- N300 billion 22.60% FGN January 2035 10-year re-opening bond
- N300 billion 16.2499% FGN April 2037 20-year re-opening bond
The agency stated that the bonds are priced at N1,000 per unit, with a minimum subscription of N50,001,000 and additional investments allowed in multiples of N1,000.
It explained that since both instruments are re-openings of previously issued bonds, their coupon rates have already been fixed.
Interest payments will be made semi-annually, while the principal will be repaid through a bullet repayment structure at maturity.
According to the DMO, successful bidders will pay based on the yield-to-maturity that clears the auction, in addition to accrued interest.
The office also noted that the bonds are backed by the full faith and credit of the Federal Government of Nigeria.
The latest issuance underscores the Federal Government’s continued reliance on the domestic debt market to finance budget deficits, refinance maturing obligations, and support infrastructure development while reducing exposure to foreign currency borrowing risks.
A month-on-month comparison showed that the government reduced its bond offer size by N100 billion in May compared to April 2026.
In April, the DMO offered N700 billion across three instruments:
- N300 billion 10-year 2035 bond
- N100 billion 7-year 2032 bond
- N300 billion 5-year 2030 bond
The reduction to N600 billion in May suggests a more calibrated borrowing approach, likely influenced by improved liquidity conditions driven by rising oil prices, as well as efforts to manage increasing debt service costs.
The bonds also come with several regulatory and tax incentives aimed at boosting investor participation.
According to the DMO:
- The instruments qualify as trustee investment securities under the Trustee Investment Act
- They qualify as government securities under the Company Income Tax Act (CITA) and Personal Income Tax Act (PITA)
- Pension funds and other eligible institutional investors may benefit from tax exemptions
- The bonds are listed on the Nigerian Exchange Limited and FMDQ OTC Securities Exchange for secondary market trading
- FGN 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 financial institutions 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.
