DMO Raises N614.5bn From May FGN Bond Auction Amid High Demand

…As CBN opens N650bn T-bills auction

The federal government has raised N614.5 billion from the domestic market through the May 2026 FGN bond auction, with Investors’ appetite stronger for the longer-dated instrument.

This is as the Central Bank of Nigeria (CBN) opens a N650 billion worth of Treasury Bills worth auction today, Wednesday, May 20, 2026, as part of efforts to mop up excess liquidity from the financial system.

According to the auction results released by the Debt Management Office (DMO), the funds were raised through the 22.60 per cent FGN JAN 2035 bond and the 16.2499 per cent FGN APR 2037 bond, two reopened instruments with an initial offer size of N300 billion each.

The 22.60 per cent FGN JAN 2035 bond attracted total subscriptions of N262.23 billion from 130 bids, of which 79 were successful. The DMO eventually allotted N137.67 billion to the instrument, which has a remaining tenor of 8 years and 8 months.

Bid rates on the JAN 2035 bond ranged from 15.00 per cent to 22.60 per cent, while the marginal rate settled at 17.00 per cent. The DMO stated that successful bids on the bond were allotted at the marginal rate of 17.00 per cent, while the original coupon rate of 22.60 per cent remains unchanged.

Investor demand was, however, stronger for the 16.2499 per cent FGN APR 2037 bond, driven largely by institutional investors and non-competitive bids.

The APR 2037 bond received 135 bids, of which 96 were accepted by the DMO. Total subscriptions stood at N253.94 billion, alongside N280 billion in non-competitive bids.

Total allotment on the instrument rose to N476.84 billion, significantly above the initial offer size of N300 billion.

The bond, which has a remaining tenor of 10 years and 11 months, recorded bid rates ranging between 14.00 per cent and 18.49 per cent, while the marginal rate closed at 17.04 per cent. The DMO noted that successful bids for both instruments were allotted at their respective marginal rates of 17.00 per cent and 17.04 per cent, while the original coupon rates remain unchanged at 22.60 per cent for the JAN 2035 bond and 16.2499 per cent for the APR 2037 bond.

Meanwhile, the NTB auction, which represents the second Treasury Bills issuance for May, forms part of the federal government’s domestic borrowing plan aimed at funding short-term obligations, managing liquidity conditions, and supporting fiscal operations in the second quarter of the year.

According to the CBN’s tender notice issued on behalf of the DMO, the apex bank will offer the instruments across three maturities through the Dutch auction system, comprising N100 billion in 91-day bills, N50 billion in 182-day bills, and N500 billion in 364-day bills.

The auction results are expected to be announced on the same day, and successful subscribers are expected to fund their accounts with the apex bank not later than 11:00 a.m. on the settlement date.

The latest issuance follows an earlier NTB auction held on May 7, 2026, in which the CBN offered N700 billion across the same tenors.

Market analysts said the 364-day instrument is expected to attract the strongest investor demand due to its relatively attractive yield profile compared to shorter-dated bills.

Analysts at Cordros Research said liquidity in the financial system is likely to support robust participation in the auction.

According to the analysts, “We anticipate robust system liquidity to support investor demand in the Treasury bills secondary market, maintaining downward pressure on yields. Additionally, the DMO is scheduled to conduct an NTB PMA next Wednesday (May 20), with N650 billion in bills expected to be offered.”

They added that, “At the auction, the elevated liquidity in the financial system is likely to support strong demand, with stop rates expected to remain broadly stable or edge marginally lower.”