FG rakes in N1.63trn in February bond auction

The Debt Management Office (DMO) has announced that it raised the sum of N1.63 trillion from the February 2025 Federal Government of Nigeria (FGN) bond auction held on Tuesday.

The total allotment across the two bond tenors was N910.39 billion.

It said the sharp rise in demand led to higher allotments, even as yields fell, reflecting stronger investor confidence in Nigeria’s debt market.

Announcing the results via its official X handle, the DMO said the auction involved reopening the 19.30 per cent FGN APR 2029 (five-year bond) and the 18.50 per cent FGN FEB 2031 (seven-year bond).

The total amount on offer for both bonds was N350 billion, with N200 billion allocated for the five-year bond and N150 billion for the seven-year bond.

However, strong demand saw the total allotment jump to N910.39 billion, surpassing both the initial offer and the total allotment for January.

The five-year bond’s allotment rose to N305.36 billion, nearly four times its January level, while the seven-year bond’s allotment also jumped to N605.03 billion.

The DMO said the robust subscription levels highlight continued investor confidence in the government’s debt instruments, driven by attractive yields and Nigeria’s stable credit ratings.

Experts say the lower bond yields typically indicate that investors perceive reduced risks and are willing to accept lower returns in exchange for safety.

Also, the strong participation in February’s auction suggests that large institutional investors, such as pension funds and asset managers, had excess liquidity to deploy, further compressing yields.

Last year the Federal Government borrowed an estimated N5.84 trillion from the FGN bond market to bridge its 2024 budget deficit.

In 2025, the federal government has projected to borrow approximately N13 trillion from FGN bonds to finance its projected budget deficit, with a significant portion expected to be raised in the first quarter through a mix of new and re-opened bonds.