The Debt Management Office (DMO) has reported a strong show of investor appetite at its November 2025 auction of government bonds, with total bids reaching approximately N657 billion, representing more than 120% of the combined offer size of N460 billion.
The auction, held on 24 November 2025 with settlement scheduled for 26 November 2025, featured two reopened instruments:
A 5-year bond: the 17.945% FGN Aug 2030 re-opening (maturing 27 August 2030) with an offer size of N230 billion.
A 7-year bond: the 17.95% FGN Jun 2032 re-opening (maturing 25 June 2032) also offered at N230 billion.
Key outcomes:
For the 5-year Aug 2030 issue: total bids amounted to N147.869 billion, with allotment of N134.799 billion. The marginal rate at which successful bids were allotted was 15.9%.
For the 7-year Jun 2032 issue: total bids soared to N509.392 billion, with allotment of N448.722 billion (plus a non-competitive allotment of N6 billion). The marginal rate was 16%.
Although the coupon rates of 17.945% (5-year) and 17.95% (7-year) remain unchanged, the pricing to investors via allocation was determined on the basis of the auction yields (marginal rates).
What this means
The overwhelming demand for the 7-year bond, with bids of N509 billion versus the offer size of N230 billion, highlights investor preference for longer-dated paper in the current environment. The near >2x subscription ratio for the 7-year compared to the 5-year (which was undersubscribed relative to the offer) suggests investors are confident in holding longer maturities.
The marginal yields of 15.90% and 16.00% are notable: while demand was strong, investors appear to be demanding higher returns, possibly reflecting inflation expectations, currency risk, or broader macro-economic concerns.
By reopening existing bonds rather than issuing new ones, the Federal Government is continuing to elongate maturities and deepen the domestic debt market — two of the stated objectives of FGN bond issuance.
The oversubscription in aggregate (by about 120% of offer size) signals confidence among institutional investors in sovereign paper, even amid inflationary and currency risk. At the same time, the higher yields signal caution.
What you should know
According to the DMO, the bond issuance was carried out in compliance with the Debt Management Office (Establishment) Act, 2003, and the Local Loans (Registered Stock and Securities) Act, CAP. L17, Laws of the Federation of Nigeria 2004.
- Each unit of the bonds is priced at N1,000, with a minimum subscription amount of N50,001,000. Additional subscriptions must be made in multiples of N1,000.
- Although the coupon rates are predetermined, successful bidders at the auction pay a price based on the yield-to-maturity that clears the offered volume, along with any accrued interest from the last interest payment date up to the settlement date.
