Naira Rain: Investors Pour N4.67 Trillion into FGN Bonds Despite Slight Dip from 2024
Nigeria’s Federal Government bond market continues to thrive, with investors staking an impressive ₦4.67 trillion in FGN bonds within the first seven months of 2025. This strong demand—though slightly below the ₦5.18 trillion recorded in the same period of 2024—signals sustained investor confidence, driven by attractive yields and Nigeria’s stable credit ratings.
What the Numbers Say:
• Total bond subscription (Jan–July 2025): ₦4.67 trillion
• Subscription same period 2024: ₦5.18 trillion (a 9.9% drop YoY)
• Bonds allotted in 2025: ₦4.09 trillion (vs ₦4.35 trillion in 2024)
• Initial bond offer in 2025: ₦1.93 trillion
Government’s Borrowing Target:
To finance the projected ₦13 trillion 2025 budget deficit, the FG is banking heavily on bond markets—especially in H1 2025, via a mix of new issuances and bond re-openings.
July 2025 Auction Highlights (Held July 28):
• APR 2029 bond (5-Year):
Offer: ₦20 billion
Subscription: ₦39.075 billion
Allotment: ₦13.43 billion
Coupon: 19.30%
Marginal Rate: 15.69%
• JUN 2032 bond (7-Year):
Offer: ₦60 billion
Subscription: ₦261.597 billion
Allotment: ₦172.502 billion
Coupon: 17.95%
Marginal Rate: 15.90%
Investor Behavior & Market Signals:
Despite fixed coupon rates, the auction clearing at lower marginal rates suggests investor optimism about easing inflation or a potential monetary policy pivot.
• Total Bids: 149
• Successful Bids: 74
• Strong institutional participation (Pension Funds, Asset Managers)
Bond Basics:
• Price per unit: ₦1,000
• Minimum subscription: ₦50,001,000
• Interest: Semi-annual payouts
• Repayment: Bullet (lump sum) at maturity
January 2025 Auction Recap:
• Offer: ₦450 billion
• Raised: ₦669.94 billion
• Allotted: ₦601.03 billion
Expert Insight:
According to analysts, the ongoing oversubscription trend reflects:
• Investor confidence in FG’s ability to meet debt obligations
• Excess liquidity in institutional portfolios
• A flight to safety amid broader market uncertainties
Market Outlook – Could a Bond Rally Be Coming?
Analysts at Coronation project a possible bond market rally in Q4 2025:
“If inflation slows and interest rates fall, long-term bonds could outperform. A rally might even support naira appreciation or at least reduce its volatility.”
Nigeria’s Federal Government bond market continues to thrive, with investors staking an impressive ₦4.67 trillion in FGN bonds within the first seven months of 2025. This strong demand—though slightly below the ₦5.18 trillion recorded in the same period of 2024—signals sustained investor confidence, driven by attractive yields and Nigeria’s stable credit ratings.
What the Numbers Say:
• Total bond subscription (Jan–July 2025): ₦4.67 trillion
• Subscription same period 2024: ₦5.18 trillion (a 9.9% drop YoY)
• Bonds allotted in 2025: ₦4.09 trillion (vs ₦4.35 trillion in 2024)
• Initial bond offer in 2025: ₦1.93 trillion
Government’s Borrowing Target:
To finance the projected ₦13 trillion 2025 budget deficit, the FG is banking heavily on bond markets—especially in H1 2025, via a mix of new issuances and bond re-openings.
July 2025 Auction Highlights (Held July 28):
• APR 2029 bond (5-Year):
Offer: ₦20 billion
Subscription: ₦39.075 billion
Allotment: ₦13.43 billion
Coupon: 19.30%
Marginal Rate: 15.69%
• JUN 2032 bond (7-Year):
Offer: ₦60 billion
Subscription: ₦261.597 billion
Allotment: ₦172.502 billion
Coupon: 17.95%
Marginal Rate: 15.90%
Investor Behavior & Market Signals:
Despite fixed coupon rates, the auction clearing at lower marginal rates suggests investor optimism about easing inflation or a potential monetary policy pivot.
• Total Bids: 149
• Successful Bids: 74
• Strong institutional participation (Pension Funds, Asset Managers)
Bond Basics:
• Price per unit: ₦1,000
• Minimum subscription: ₦50,001,000
• Interest: Semi-annual payouts
• Repayment: Bullet (lump sum) at maturity
January 2025 Auction Recap:
• Offer: ₦450 billion
• Raised: ₦669.94 billion
• Allotted: ₦601.03 billion
Expert Insight:
According to analysts, the ongoing oversubscription trend reflects:
• Investor confidence in FG’s ability to meet debt obligations
• Excess liquidity in institutional portfolios
• A flight to safety amid broader market uncertainties
Market Outlook – Could a Bond Rally Be Coming?
Analysts at Coronation project a possible bond market rally in Q4 2025:
“If inflation slows and interest rates fall, long-term bonds could outperform. A rally might even support naira appreciation or at least reduce its volatility.”