Image: chippla / Wikimedia Commons, Public domain
The Federal Government's securitised Ways and Means balance fell to ₦22.106tn at 30 June 2026, its first recorded reduction since the CBN overdraft was converted into a 40-year, 9% instrument in 2023.
The Federal Government’s securitised Ways and Means debt fell by ₦613.34bn in the second quarter of 2026, the first recorded reduction since the obligation was added to Nigeria’s public debt stock in 2023, Nairametrics reported on 28 September 2026 using Debt Management Office (DMO) data. The outstanding balance dropped to ₦22.106tn at 30 June 2026 from ₦22.719tn at 31 March, a quarter-on-quarter fall of 2.70%.
How the debt was restructured
Ways and Means Advances are temporary Central Bank of Nigeria (CBN) loans that cover gaps between government revenue and spending. According to Nairametrics, the previous administration borrowed beyond the statutory limits in the CBN Act, and in May 2023 the National Assembly approved the conversion of the short-term liability into long-term domestic debt securities.
The securitised amount of ₦22.719tn carries a 40-year tenor and an annual interest rate of 9%. It came with a three-year moratorium on principal, followed by a 37-year amortisation period. The Q2 reduction coincided with the end of that moratorium, which suggests principal repayments have begun.
Scale in the debt stock
Nairametrics reported that the securitised balance accounts for 25.41% of total FGN domestic debt, and is equivalent to 34.09% of the ₦64.839tn stock of FGN bonds.
Why it matters
The start of amortisation turns an accounting conversion into a recurring cash obligation for the Federal Government, owed to its own central bank. For fixed income investors, the size of the instrument relative to the bond market means that its servicing terms matter for the government’s overall borrowing needs and, in turn, for the supply of new FGN bonds and Treasury bills.
The legal point is the one that prompted the conversion in the first place: statutory limits on central bank lending to government only work if they are enforced. The 2023 securitisation regularised past breaches with legislative approval rather than repaying them within the CBN Act’s framework. Lawyers advising on sovereign and quasi-sovereign debt, and on monetary policy transmission, should watch whether future advances stay within the statutory cap, since a return to overdraft financing would weaken the credibility of the limit and add inflationary pressure.
The fixed 9% coupon over 40 years also matters for the CBN’s own balance sheet, since the terms of a claim on government that large shape the income the central bank earns on it. Investors and counsel assessing sovereign credit will want the DMO’s future quarterly data to confirm whether the reduction continues on a regular amortisation path.
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