The Debt Management Office (DMO) plans to raise ₦800 billion at its February 2026 Federal Government bond auction, underscoring continued reliance on the domestic debt market despite borrowing costs remaining close to 20 per cent.
According to the bond circular released Monday, the auction is scheduled for February 23, 2026, with settlement on February 25.
The February programme includes:
- ₦400bn – 17.95 per cent FGN JUN 2032 (7-year re-opening)
- ₦300bn – 19.89 per cent FGN MAY 2033 (10-year re-opening)
- ₦100bn – 19.00 per cent FGN FEB 2034 (10-year re-opening)
Total: ₦800 billion
The structure shows a clear shift toward longer tenors, with no 5-year instrument included.
In February 2025, the DMO offered ₦350 billion:
- ₦200bn (5-year, 19.30%)
- ₦150bn (7-year, 18.50%)
This means the 2026 offer is ₦450bn higher year-on-year, representing a 128.6 per cent increase.
The absence of a 5-year bond this year suggests a deliberate strategy to extend the maturity of debt and ease near-term refinancing pressure.
February’s ₦800bn issuance is lower than January 2026’s ₦900bn offer – an 11.1% month-on-month decline.
In January, the DMO issued:
- ₦300bn (7-year, 18.50%)
- ₦400bn (10-year, 19.00%)
- ₦200bn (10-year, 22.60%)
Notably, the January 2035 bond carried a steep 22.60 per cent coupon, significantly above February’s 10-year rates of 19.89 per cent and 19.00 per cent, suggesting mild easing at the long end of the yield curve.
While the 7-year rate declined from 18.50 per cent in January to 17.95 per cent in February, long-term yields remain historically high, hovering between 18 per cent and 20 per cent.
The elevated rates reflect:
- Tight liquidity conditions
- Sustained monetary policy restraint
- Strong investor demand for higher returns
February’s issuance signals a recalibration, not a retreat.
Although the DMO trimmed the offer from January’s record level, the government is still borrowing at more than double the amount raised in February 2025, and at rates near 20 per cent.
With domestic debt costs remaining elevated, the February auction highlights the growing price of government financing in Nigeria’s high-yield environment.
