The Federal Government significantly increased its borrowing through the domestic bond market in the first nine months of 2026, allotting N7.15tn worth of Federal Government of Nigeria bonds.

The amount represents a 106 per cent increase compared with the N3.48tn allotted during the corresponding period of 2025, according to an analysis of monthly auction results published by the Debt Management Office.

The sharp rise indicates a substantial increase in the volume of government securities allocated to investors as the Federal Government continues to utilise the domestic capital market to meet its financing requirements.

The growth was driven largely by exceptionally high allotments recorded in January, June, July and August, which more than offset declines recorded in some other months.

June recorded the most pronounced year-on-year increase during the period, with the DMO allotting N1.22tn in FGN bonds, compared with N100bn in the corresponding month of 2025.

January also recorded a major increase, with allotments rising to N1.54tn from N601.04bn, representing a 157 per cent increase. In July, the government allotted N931.82bn, compared with N185.93bn a year earlier, translating to a 401 per cent increase.

August recorded another substantial jump, with allotments rising to N805.16bn from N136.16bn, an increase of 491 per cent. September followed with N748.64bn allotted, up 29.8 per cent from N576.62bn recorded in the same month of 2025.

The upward movement came despite weaker performances in February and April, when bond allotments fell by 42.4 per cent and 30.4 per cent, respectively, compared with the corresponding months of the previous year.

Overall, however, the large increases recorded in the other months were sufficient to push cumulative allotments more than twice above the 2025 level.

The increase in allotments occurred amid substantial investor demand for government securities. Total subscriptions for FGN bonds reached N13.72tn between January and September 2026, significantly exceeding the volume eventually allotted by the government.

February recorded the highest subscription during the period at N2.70tn, followed by January with N2.25tn. July attracted N1.70tn in subscriptions, while March recorded N1.50tn.

Demand remained relatively strong during the middle and latter parts of the year, with investors subscribing to N1.41tn in June, N1.35tn in August, and N1.36tn in September.

The disparity between subscriptions and allotments suggests that investors submitted bids above the amount the government ultimately accepted at the auctions.

The strong subscription levels also point to continued investor participation in the sovereign debt market despite the significant increase in government bond supply. The increased bond issuance comes as FGN bonds continue to dominate the Federal Government’s domestic debt structure.

As of June 30, 2026, Nigeria’s total public debt stood at N166.79tn, while domestic debt accounted for N91.59tn, representing 54.91 per cent of the total debt stock.

FGN bonds accounted for the largest portion of the Federal Government’s domestic debt, with an outstanding value of N64.84tn. The figure represented 74.53 per cent of the Federal Government’s domestic debt portfolio.

Other domestic debt instruments included FGN Sukuk, savings bonds, green bonds and promissory notes. FGN Sukuk accounted for N1.19tn, while savings bonds stood at N122.45bn. Green bonds amounted to N47.36bn, with promissory notes at N1.22tn.

The composition of the debt portfolio highlights the central role of conventional FGN bonds in the government’s domestic financing programme. The surge in bond allotments further underscores the Federal Government’s reliance on the domestic capital market as a source of funding.