Nigeria’s subnational debt profile deteriorated further in 2025, with the combined debt stock of the 36 states and the Federal Capital Territory (FCT) rising to N4.36 trillion.
Even as Lagos maintained its position at the top with a debt profile of N1.04 trillion.
The figures are culled from the latest released data on states’ debt profile by the Debt Management Office (DMO), reflecting increased borrowing by state governments to fund infrastructure, manage fiscal gaps, and navigate a challenging macroeconomic environment.
Total debt stock of the 36 states and the FCT increased from N3.97 trillion in 2024 to N4.36 trillion in 2025, representing a 9.89% year-on-year increase.
In absolute terms, this translates to an increase of N392.41 billion, with borrowing concentrated among a few large states.
What the data is saying
The data shows a significant concentration of debt among Nigeria’s largest states, with the top 10 accounting for the bulk of total obligations, further highlighting Nigeria’s widening fiscal imbalance at the state level.
- Total subnational debt rose to N4.36 trillion in 2025 from N3.97 trillion in 2024, a 9.89% increase year-on-year.
- The top 10 most indebted states accounted for N2.96 trillion, contributing a significant 67.98% of the total debt stock, highlighting the concentration of debt among a few large states.
- The report also revealed that a large share of subnational debt is concentrated in just a handful of states — Lagos, Rivers, Delta, Ogun, and Federal Capital Territory— which together owe nearly N2.26 trillion, roughly more than half of the entire N4.36 trillion debt stock.
- Lagos stands far ahead of every other state, making up 27.97% of the total debt, more than a quarter of the total debt.
Top 10 most indebted states in Nigeria – 2025
Benue State stood out as the only state in the top 10 to reduce its debt stock.
The state recorded a decline of 12.52% with its debt falling to N107.23 billion, representing 2.46% of total debt, from N122.58 billion in 2024.
This decline suggests active debt repayment, reduced fresh borrowing, or restructuring of existing liabilities.
While positive, it also raises questions about whether fiscal consolidation constrained capital investment
