Nigeria’s Federal Government domestic debt rose to ₦87 trillion by June 2026, with short-term Nigerian Treasury Bills accounting for the largest share of the latest increase, according to figures from the Debt Management Office (DMO).
The debt stock increased by about 5 per cent from ₦82.9 trillion in the first quarter of 2026 and 13.6 per cent from ₦76.6 trillion recorded in the second quarter of 2025, highlighting the government’s growing reliance on domestic borrowing to finance its obligations.
Key Highlights
- Federal Government domestic debt reached ₦87 trillion by June 2026.
- The figure represents a 5 per cent increase from ₦82.9 trillion in March 2026.
- Treasury Bills rose by about ₦2.9 trillion during the second quarter.
- Treasury Bills accounted for about 71 per cent of the quarterly increase in federal domestic debt.
- FGN bonds remained the largest component of the debt stock at ₦64.84 trillion.
- Nigeria’s total public debt stood at ₦166.79 trillion at the end of June.
- Analysts warn that increased reliance on short-term debt could raise refinancing and debt-servicing pressures.
Treasury Bills Drive Nigeria’s Rising Domestic Debt
The latest increase in Federal Government domestic debt was driven largely by a sharp rise in Nigerian Treasury Bills, which increased by approximately ₦2.9 trillion, or 17.6 per cent, during the second quarter.
Treasury Bills stood at roughly ₦19.48 trillion by the end of June, compared with ₦13.85 trillion at the beginning of the year.
The increase means Treasury Bills accounted for approximately 71 per cent of the ₦4.1 trillion quarterly increase in Federal Government domestic debt.
Over the first six months of 2026, the rise in Treasury Bills represented about 86 per cent of the overall increase in federal domestic debt.
FGN Bonds Still Account for Majority of Debt
Despite the rapid growth in Treasury Bills, Federal Government bonds remain the largest component of Nigeria’s domestic debt.
FGN bonds stood at approximately ₦64.84 trillion, representing about 74.5 per cent of Federal Government domestic debt.
The figure includes naira-denominated bonds and securitised Ways and Means obligations.
Treasury Bills accounted for about 22.4 per cent of the debt stock.
Other domestic debt instruments included:
- Promissory notes: ₦1.22 trillion
- Sukuk: ₦1.19 trillion
- Savings bonds: ₦122 billion
- Green bond: ₦47 billion
The figures show that although bonds continue to dominate the Federal Government’s debt portfolio, short-term borrowing has increased significantly during the first half of 2026.
Nigeria’s Total Public Debt Reaches ₦166.79tn
The ₦87 trillion figure represents Federal Government domestic debt only and should not be confused with Nigeria’s total public debt.
According to the DMO figures, Nigeria’s total public debt stood at ₦166.79 trillion as of June 30, 2026, representing an increase of about ₦7.44 trillion from the March position.
Total domestic debt across the Federal Government, states and the Federal Capital Territory stood at approximately ₦91.59 trillion.
The Federal Government accounted for about ₦152.77 trillion of the country’s combined domestic and external debt.
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Short-Term Borrowing Raises Refinancing Concerns
Analysts have raised concerns over the increasing proportion of short-term Treasury Bills in the government’s borrowing mix.
Unlike longer-term bonds, Treasury Bills mature within relatively short periods, meaning the government must regularly refinance or roll over the obligations.
Analysts at Cordros and other financial institutions noted that the shift towards short-term instruments could increase refinancing pressure, particularly if interest rates remain elevated.
Higher Treasury Bill yields could also increase the cost of refinancing existing obligations when they mature.
Debt Size Must Be Viewed Alongside Government Revenue
The ₦87 trillion domestic debt figure has renewed discussion about Nigeria’s debt sustainability.
However, analysts caution that the size of the debt stock alone does not determine whether the debt burden is sustainable.
The government’s ability to generate sufficient revenue to service its obligations remains a critical factor.
Relative to the size of the Nigerian economy, the debt stock remains below levels that would automatically indicate a debt crisis.
Independent analysis estimated the debt at approximately 20 per cent of 2025 GDP and about 17 per cent of projected 2026 GDP.
However, a lower debt-to-GDP ratio does not eliminate concerns over debt servicing if government revenues remain weak.
Investors Watch Treasury Bill Borrowing
The increased issuance of Treasury Bills also has implications for Nigeria’s financial markets.
As the Federal Government competes for funds in the domestic market, increased government borrowing could affect the availability and cost of credit for businesses and other private-sector borrowers.
The key concern for investors is therefore not simply whether Nigeria’s domestic debt has reached ₦87 trillion, but whether the government can generate sufficient revenue to service the debt without putting additional pressure on the wider economy.
What the ₦87tn Debt Figure Means for Nigeria
The latest DMO figures do not mean Nigeria suddenly accumulated ₦87 trillion in new debt.
Rather, the ₦87 trillion represents the total outstanding Federal Government domestic debt position as of June 2026.
What has changed significantly is the composition of recent borrowing.
A larger portion of the increase has come through short-term Treasury Bills, meaning more government obligations will need to be refinanced as they mature.
The development makes the government’s revenue performance, interest rates and ability to manage refinancing risks increasingly important as Nigeria moves through 2026.
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