The Debt Management Office (DMO) of Nigeria has successfully raised N669.94 billion in its January 2025 Federal Government of Nigeria (FGN) bond auction.
This achievement comes as part of the government’s commitment to leveraging domestic borrowing to finance critical infrastructure projects and meet budgetary needs.
In a post shared on X (formerly Twitter), the DMO disclosed the auction’s outcome, noting that N606.46 billion was allotted across three tenors. The announcement read: “FGN BOND AUCTION RESULTS (JANUARY 2025):
Total amount raised – N669.94bn
Total amount allotted – N606.46bn
Register for Tekedia Mini-MBA edition 19 (Feb 9 – May 2, 2026): big discounts for early bird.
Tekedia AI in Business Masterclass opens registrations.
Join Tekedia Capital Syndicate and co-invest in great global startups.
Register for Tekedia AI Lab: From Technical Design to Deployment (next edition begins Jan 24 2026).
Details: 19.30% FGN APR 2029 – allotted N78.86bn at 21.79%
18.50% FGN FEB 2031 – allotted N159.29bn at 22.5%
22.60% FGN JAN 2035 – allotted N368.31bn at 22.6%.”
Breakdown of the Auction Results
The bond auction attracted strong investor participation, highlighting the market’s continued confidence in government debt instruments.
- 19.30% FGN APR 2029: This tenor raised N78.86 billion at a yield of 21.79%, reflecting favorable demand for medium-term securities.
- 18.50% FGN FEB 2031: The government allotted N159.29 billion for this bond at a competitive yield of 22.50%, marking robust investor interest in medium-to-long-term securities.
- 22.60% FGN JAN 2035: This long-term bond garnered the highest allotment of N368.31 billion, with a yield of 22.60%, emphasizing the government’s focus on securing long-term financing for development projects.
Key Highlights of the Auction
The auction’s success reflects growing investor confidence in FGN bonds, bolstered by attractive yields and the perceived stability of Nigeria’s debt instruments. The yields offered align with the prevailing market situation, ensuring competitive returns for investors while maintaining reasonable borrowing costs for the government.
The significant allotment to the 2035 bond demonstrates the government’s strategic focus on securing long-term funding to support critical infrastructure and developmental needs. The proceeds are expected to enhance financing across sectors such as healthcare, education, and transportation, while also addressing fiscal deficits.
Implications for the Economy
The funds raised through this bond auction will be pivotal in addressing Nigeria’s infrastructure deficit and supporting broader economic development initiatives. The government aims to reduce its reliance on external borrowing while offering tax-free, secure investment options to both institutional and retail investors by tapping into domestic markets.
The long-term focus on financing is part of the administration’s strategy to prioritize sustainable development. The yields offered not only attract investment but also help stabilize the local debt market by ensuring predictable returns.
Trends in Bond Auctions
This year’s January auction target of N450 billion exceeded the N360 billion raised during the same period in January 2024 and significantly outpaced the N120 billion offered in December 2024. The increased borrowing aligns with the government’s expanded developmental agenda as outlined in the 2025 budget.
FGN bonds have become a preferred investment vehicle due to their guaranteed returns, tax-free status, and alignment with Nigeria’s broader economic policies. Investors are advised to monitor future auctions closely as the government progresses with its borrowing plans for 2025.
What’s Next for Investors
The DMO is expected to conduct subsequent bond auctions throughout the year as it seeks to meet its 2025 budgetary borrowing goals. Investors should consider the competitive yields and the government’s commitment to maintaining stability in the debt market as they strategize their portfolios.
The January 2025 bond auction represents a critical step in Nigeria’s fiscal strategy, reinforcing its commitment to leveraging domestic resources to address pressing economic and developmental challenges. The next rounds of auctions will be pivotal in determining the trajectory of government financing and market participation in the months ahead.