The Debt Management Office (DMO) has reported robust investor interest at its November 2025 government bond auction, with total bids reaching approximately ₦657 billion, surpassing the combined offer of ₦460 billion. The auction, conducted on 24 November 2025 with settlement set for 26 November 2025, featured two reopened Federal Government of Nigeria (FGN) bonds. The event highlighted a significant flock of investors attracted by the high demand for longer-dated paper.
Auction Breakdown
5-Year Bond (17.945% FGN Aug 2030 Reopening):
- Offer Size: ₦230 billion
- Total Bids: ₦147.869 billion
- Allotment: ₦134.799 billion
- Marginal Rate: 15.9%
- Coupon Rate: 17.945%
7-Year Bond (17.95% FGN Jun 2032 Reopening):
- Offer Size: ₦230 billion
- Total Bids: ₦509.392 billion
- Allotment: ₦448.722 billion (+ ₦6 billion non-competitive)
- Marginal Rate: 16%
- Coupon Rate: 17.95%
The marginal rates determined allocation pricing for investors, while the coupon rates remained fixed. Each bond unit is priced at ₦1,000, with a minimum subscription of ₦50,001,000 and additional subscriptions in multiples of ₦1,000.
Investor Preference for Longer-Term Bonds
The oversubscription of the 7-year bond highlights investor appetite for longer-dated FGN securities. Investors showed particular interest, underlining the importance of the November 2025 bond auction. Conversely, the 5-year bond was undersubscribed relative to the offer, indicating a preference for extended maturities in today’s market environment.
The marginal yields of 15.9% and 16% reflect investor confidence but also signal expectations of inflation, currency fluctuations, and macroeconomic risks in Nigeria.
Strategic Impact on Nigeria’s Bond Market
By reopening existing bonds rather than issuing new instruments, the Federal Government continues its strategy to:
- Elongate debt maturities
- Deepen the domestic bond market
The auction’s aggregate oversubscription (~120% of offer size) signals strong institutional confidence in Nigerian sovereign debt, also highlighting that investors flock to the Nigerian bond market during this high-demand auction.
Legal Compliance and Settlement
The DMO confirmed that the bond auction was carried out in line with:
- Debt Management Office (Establishment) Act, 2003
- Local Loans (Registered Stock and Securities) Act, CAP. L17, Laws of the Federation of Nigeria 2004
Successful bidders pay based on the yield-to-maturity that clears the offered volume, along with accrued interest from the last coupon payment date to settlement.
