Oversubscription hits 4.28% as appetite grows for long-term government debt, with 2033 bond leading demand…..
Nigeria’s sovereign debt market recorded robust investor interest in March, as the latest bond auction by the Debt Management Office Nigeria came in significantly oversubscribed.
According to data released on Tuesday, investors submitted bids totaling N931.5 billion for bonds valued at N750 billion, translating to an oversubscription rate of 4.28 percent.
Despite the strong demand, total allotments declined to N485.49 billion about 7.4 percent lower than the N524.28 billion recorded in February suggesting a more selective issuance strategy by the government.
Three instruments were offered during the auction, spanning medium- to long-term maturities. These included the 17.945% FGN AUG 2030 bond (5-year reopening), the 17.95% FGN JUN 2032 bond (7-year reopening), and the 19.89% FGN MAY 2033 bond (9-year reopening).
Investor appetite was most pronounced for the 9-year MAY 2033 instrument, which attracted N462.21 billion in bids from 154 successful participants. It also accounted for the largest share of allocations, with N332.71 billion allotted.
The AUG 2030 bond received N88.79 billion in allotments, while the JUN 2032 instrument secured N63.99 billion.
Clearing yields for the auction settled at 16 percent for the 2030 bond, 16.15 percent for the 2032 bond, and 16.64 percent for the 2033 bond, levels that continue to reflect relatively high returns in Nigeria’s fixed-income market.
During the bidding process, yields were priced within broad ranges, indicating active participation and varying investor expectations. The 2030 bond saw bids between 14.8 percent and 17 percent, the 2032 bond ranged from 15 percent to 17.95 percent, while the 2033 bond recorded bids between 14 percent and 19.89 percent.
The strong turnout underscores sustained investor confidence in Federal Government securities, particularly longer-dated instruments that offer higher yields.
At the same time, the reduced allotment size suggests authorities may be balancing borrowing needs with cost considerations, amid a broader effort to manage Nigeria’s rising debt profile.
With demand remaining firm, Nigeria’s bond market continues to play a central role in financing government expenditure while offering investors attractive returns in a high-yield environment.
