By Jennete Ugo Anya
The Federal Government of Nigeria, through the Debt Management Office (DMO), successfully concluded its July 2025 bond auction with an allotment of N185.93 billion, surpassing initial expectations and signaling sustained investor confidence in government securities.
The auction, conducted on July 28, 2025, involved the re-opening of two existing FGN bond instruments:
- N20 billion offer for the 19.30% FGN Apr 2029 (5-year tenor)
- N60 billion offer for the 17.95% FGN Jun 2032 (7-year tenor)
According to data released by the DMO, the 5-year APR 2029 bond attracted N39.08 billion in total subscriptions from 40 bids, out of which N13.43 billion was allotted. The 7-year Jun 2032 bond witnessed robust demand, drawing N261.60 billion in subscriptions from 109 bids, with N172.50 billion allotted.
The total allotment of N185.93 billion far exceeded the initial N80 billion offer, demonstrating growing market appetite for medium-term sovereign debt instruments.
The bonds maintained their original coupon rates of 19.30% and 17.95% respectively but were allotted at marginal rates of 15.69% (5-year) and 15.90% (7-year). The lower marginal rates reflect declining yield expectations, possibly driven by investor confidence in moderating inflation and a stable monetary policy outlook.
The auction saw 149 total bids, with 74 successful bids—15 for the 5-year instrument and 59 for the 7-year.
Comparison with June 2025 Auction
The July figures outpaced the N100 billion offered in the previous month’s auction. In June 2025:
- The 5-year APR 2029 bond drew N41.69 billion in bids but only N1.05 billion was allotted from 2 successful bids.
- The newly issued 7-year JUN 2032 bond attracted N561.17 billion in subscriptions across 209 bids, with N98.95 billion eventually allotted.
Marginal rates for the June auction stood at 17.75% (5-year) and 17.95% (7-year), indicating a downward shift in July.
Regulatory Compliance and Key Bond Terms
The issuance aligns with the provisions of the Debt Management Office (Establishment) Act, 2003, and the Local Loans (Registered Stock and Securities) Act, Cap L17, Laws of the Federation of Nigeria, 2004.
Key details include:
- Price per bond unit: N1,000
- Minimum subscription: N50,001,000
- Additional investments: In multiples of N1,000
- Interest payment: Semi-annually
- Repayment: Bullet repayment on maturity date
Successful bidders are allotted bonds based on yield-to-maturity, with accrued interest factored in from the last coupon date to the settlement date.
The settlement for the July auction was scheduled for July 30, 2025.
