The Debt Management Office (DMO) has announced that the Federal Government will seek to raise N900 billion through the reopening of three federal bonds in its January 2026 auction.
The auction, according to a DMO circular issued on Monday, is scheduled for January 26, 2026, with settlement set for January 28, 2026.
The offering spans medium- and long-term bonds, providing investors with opportunities across multiple maturities.
What DMO is saying
The January offer comprises three reopened instruments targeting subscriptions of N300 billion from the 18.50 per cent FGN February 2031 bond, N400 billion from the 19.00 per cent FGN February 2034 bond, and N200 billion from the 22.60 per cent FGN January 2035 bond.
- Each bond is offered at N1,000 per unit, with a minimum subscription of N50,001,000 and subsequent increments in multiples of N1,000.
- Coupon rates for the reopened bonds are fixed, with successful bidders paying a price that reflects the yield-to-maturity clearing the auction volume, plus any accrued interest.
- Interest is paid semi-annually, and principal is repaid in full at maturity under a bullet repayment structure.
According to DMO records, total bond allotments in 2025 reached approximately N5.12 trillion, indicating strong market participation and demand for government securities.
What you should know
The FGN has routinely used bond reopenings as a tool to finance budget deficits while deepening Nigeria’s domestic debt market.
These instruments provide long-term investment options for pension funds, insurance companies, and individual investors seeking predictable yields.
Reopened bonds allow the government to tap into existing instruments with known coupon rates, offering certainty for investors and reducing the administrative costs of issuing new securities.
Additionally, such offerings strengthen market liquidity and contribute to the development of a benchmark yield curve for the domestic market.
Investors in the January auction will benefit from several statutory and regulatory incentives.
- The bonds qualify as investments for trustees under the Trustee Investment Act.
- They are recognised as government securities under the Company Income Tax Act (CITA) and Personal Income Tax Act (PITA), making them eligible for tax exemptions.
- The bonds will be listed on the Nigerian Exchange Limited (NGX) and the FMDQ OTC Securities Exchange, ensuring tradability and transparency.
- FGN bonds count as liquid assets for banks when calculating liquidity ratios and are backed by the full faith and credit of the Federal Government.
Applications must be submitted through any of the authorised Primary Dealer Market Makers (PDMMs), according to DMO circular.
The January auction is part of the FGN’s broader domestic borrowing strategy aimed at financing budgetary obligations while providing investors with stable, long-term investment opportunities and supporting the growth of the domestic debt market.
