Despite promises by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, that the Federal Government would reduce borrowing in the 2026 fiscal year and beyond, data from the Debt Management Office (DMO) has reflected that the government intended to scale up domestic borrowing by raising as much as N900 billion from its January 2026 bond auction.
The amount is higher by 100% when compared to the N450 billion it targeted from its January 2025 bond offers, amid mounting fiscal pressures and refinancing needs.
The DMO, in its documents released for the January 2026 auction, indicated that offer would feature three reopened Federal Government of Nigeria (FGN) bonds with a combined value of N900 billion,
In January 2025 auctions, the government adopted a more restrained borrowing posture, offering three bonds across the five-year, seven-year, and 10-year segments.
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Specifically, in the January 2025 bond auctions, the Federal Government targeted to raise N100bn from a five-year bond originally issued in April 2029 with a 19.30 per cent coupon, N150bn from a seven-year February 2031 bond carrying an 18.50 per cent coupon, and N200bn from a new ten-year January 2035 bond.
The total N450bn offer reflected comparatively lower funding requirements at the time, even as interest rates remained elevated.
In its offer circular on the January 2026 bond auction, the DMO stated that the government planned to raise N300bn from a reopening of the 18.50 per cent FGN February 2031 bond, N400bn from a reopening of the 19.00 per cent FGN February 2034 bond, and N200bn from a reopening of the 22.60 per cent FGN January 2035 bond.
Based on the figures, the 10-year instrument accounted for N600bn, representing about two-thirds of the total auction, compared with N200bn in ten-year paper offered in January 2025, just as the 22.60 per cent coupon on the January 2035 bond is far higher than the rates for the same tenor bond last year.
The Office further stated that the bonds would be sold at N1,000 per unit, with a minimum subscription of N50.001m, interest payable semi-annually, and bullet repayment at maturity, adding that for reopened bonds, successful bidders will pay prices based on the yield that clears the auction volume, in addition to accrued interest.
It would be recalled that a few days ago at the World Economic Forum event held in Davos, Switzerland, the Finance Minister told Bloomberg that the Federal Government planned to rev up revenue generation drive to meet its expenditures rather than depending on borrowing to meet its funding obligations.
He assured: “The issue now is to focus on revenue, focus on domestic resource mobilization. We’re hoping to rely less on borrowing.”
