FG Rolls Out ₦1.76tn NT-Bills to Cover Maturing Short-Term Obligations

The Federal Government plans to issue ₦1.76 trillion in Nigerian Treasury Bills (NT-Bills) in the third quarter of 2025 to refinance a larger ₦1.98 trillion in maturing short-term debt as it continues to manage liquidity pressures and roll over near-term obligations.

The new issuance programme, disclosed in the Debt Management Office’s latest auction calendar, shows a clear focus on balancing rollover risk while containing borrowing costs amid a moderating yield environment.

Breakdown of the plan indicates that the government will raise about ₦340 billion in 91-day bills, ₦230 billion in 182-day notes and a significant ₦1.19 trillion through the longer-tenor 364-day instruments. In comparison, maturing obligations for the same period stand at ₦400.05 billion for 91-day bills, ₦242.72 billion for 182-day bills and ₦1.34 trillion for 364-day tenors.

The auction cycle begins on July 10 with a total offer of ₦250 billion, covering ₦100 billion in 91-day, ₦20 billion in 182-day and ₦130 billion in 364-day bills. The proceeds are expected to refinance ₦301.94 billion maturing the following day.

Subsequent auctions will follow a rolling pattern, with scheduled dates on July 24 (₦290 billion), August 7 (₦220 billion), August 21 (₦230 billion), September 4 (₦480 billion) and September 18 (₦290 billion).

The largest single offering will take place on September 4 to cover a significant portion of the ₦324.4 billion due for maturity at that time.

The planned borrowing comes as the government navigates a high domestic deficit environment. Net domestic borrowing in the first half of the year has already reached around ₦3.4 trillion, driven mainly by NT-Bill and Open Market Operation (OMO) issuances, partially offset by coupon payments and liquidity absorption.

Analysts at Afrinvest project a budget deficit of ₦17.2 trillion for 2025, exceeding the official ₦14.1 trillion estimate.

This could leave a second-half domestic funding gap of at least ₦10 trillion if external borrowing targets are not fully met.

Meanwhile, recent auctions suggest that investor appetite remains robust, supported by easing yields. Benchmark NT-Bill rates have fallen to around 19.4% for the one-year tenor, down from over 29% at the beginning of 2024, driven by improving monetary transmission, stable FX conditions and reduced inflationary pressure.

CardinalStone analysts expect yields to average 19.5%–22.5% across the curve in the second half of the year, supported by potential monetary policy easing if disinflation continues.

However, the heavy supply schedule may test market liquidity and could influence yield direction if demand weakens or if inflation risks resurface.

Market watchers will closely monitor coverage ratios, allotment outcomes and the CBN’s policy signals over the coming months as the government balances its refinancing needs against cost management objectives.