Federal Government bonds see 35% excess demand at recent April sale

The Federal Government of Nigeria's bond auction in April 2026 saw a notable 35.4% oversubscription, with the Debt Management Office revealing that investors displayed robust demand, as evidenced by the auction's outcome on Monday.

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Investors submitted bids totaling N948.01 billion for bonds valued at N700 billion, yet the total allotments decreased by 42.9% to N276.79 billion, marking a decline from the N485.49 billion recorded in March.

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During the auction, three bond instruments were offered to investors, including the 17.945% FGN AUG 2030, a 5-year reopening with N300 billion on offer, as well as the 17.95% FGN JUN 2032 and the 22.6% FGN JAN 2035, with N100 billion and N300 billion available, respectively.

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The 10-year JAN 2035 bond garnered the most interest from investors, attracting N599.023 billion in bids from 154 successful applicants, which underscored the strong demand for this particular instrument.

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The majority of the allotments, totaling N211.24 billion, were also allocated to the JAN 2035 bond, while the AUG 2030 bond received N46.84 billion and the JUN 2032 bond got N18.72 billion.

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The clearing yields for the bonds were recorded as follows: 16.3% for the AUG 2030 bond, 16.5% for the JUN 2032 bond, and 16.59% for the JAN 2035 bond, providing insight into the auction's outcome.

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The bonds were priced within specific ranges during the auction: the AUG 2030 bond ranged from 15.35% to 17.95%, the JUN 2032 bond from 16% to 18%, and the JAN 2035 bond from 15% to 22.6%.

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The auction results highlight the growing appetite among investors for Nigerian government debt, despite the fact that allotments were tighter compared to previous months, indicating a shift in the market's dynamics.