The Federal Government sharply raised its borrowing from the domestic bond market in the first nine months of 2026, allotting FGN bonds worth N7.15tn.
The figure is 106 per cent higher than the N3.48tn allotted in the same period of 2025, based on an analysis of the monthly auction results published by the Debt Management Office.
The steep rise shows a considerable growth in the volume of government securities placed with investors, as the Federal Government keeps leaning on the domestic capital market to meet its financing needs.
The growth was driven mainly by unusually high allotments in January, June, July and August, which more than made up for declines in some other months.
June posted the sharpest year-on-year increase, as the DMO allotted N1.22tn in FGN bonds, against N100bn in June 2025.
January also saw a major jump, with allotments climbing to N1.54tn from N601.04bn, a 157 per cent increase. In July, the government allotted N931.82bn, compared with N185.93bn a year earlier, which translates to a 401 per cent rise.
August recorded another big leap, with allotments rising to N805.16bn from N136.16bn, an increase of 491 per cent. September followed with N748.64bn allotted, up 29.8 per cent from the N576.62bn recorded in September 2025.
The upward trend occurred despite weaker showings in February and April, when bond allotments fell by 42.4 per cent and 30.4 per cent, respectively, compared with the same months of the previous year.
Overall, the large gains in the other months were enough to push cumulative allotments to more than double the 2025 level.
The rise in allotments came amid strong investor appetite for government securities. Total subscriptions for FGN bonds hit N13.72tn between January and September 2026, far above the volume the government eventually allotted.
February recorded the highest subscription in the period at N2.70tn, followed by January with N2.25tn. July drew N1.70tn in subscriptions, while March recorded N1.50tn.
Demand stayed fairly strong in the middle and later months of the year, with investors subscribing N1.41tn in June, N1.35tn in August and N1.36tn in September.
The gap between subscriptions and allotments suggests that investors placed bids above what the government finally accepted at the auctions.
The high subscription levels also indicate that investors have continued to participate in the sovereign debt market despite the marked increase in the supply of government bonds. The higher issuance comes as FGN bonds continue to dominate the Federal Government’s domestic debt structure.
As of June 30, 2026, Nigeria’s total public debt stood at N166.79tn, while domestic debt made up N91.59tn, or 54.91 per cent of the total debt stock.
FGN bonds formed the largest share of the Federal Government’s domestic debt, with an outstanding value of N64.84tn. That amount represented 74.53 per cent of the Federal Government’s domestic debt portfolio.
Other domestic debt instruments include FGN Sukuk, savings bonds, green bonds and promissory notes. FGN Sukuk stood at N1.19tn and savings bonds at N122.45bn, while green bonds amounted to N47.36bn and promissory notes N1.22tn.
The composition of the debt portfolio underlines the central role of conventional FGN bonds in the government’s domestic financing programme. The surge in bond allotments further highlights the Federal Government’s dependence on the domestic capital market as a source of funding.
