The Federal Government has commenced repayment of the ₦4 trillion debt owed to Power Generation Companies (GenCos) with the launch of a ₦590 billion first‑tranche bond issuance under the NBET Finance Company Plc Bond Programme.
The initial tranche is guaranteed by the Federal Government and comprises:
- ₦300bn cash bonds to be issued to the market.
- ₦290bn non‑cash bonds directly allotted to GenCos on identical terms.
According to the term sheet, the Series 1 bond will be issued between November and December 2025, with a seven‑year tenor, fixed‑rate coupon, and semi‑annual interest payments on an amortising basis.
CardinalStone Partners Limited is serving as lead issuing house and financial adviser.
Market Features
- Listed on the Nigerian Exchange (NGX) and FMDQ Securities Exchange.
- Qualifies under the Trustee Investment Act, making it eligible for pension funds, banks, insurers, and asset managers.
- Minimum subscription: ₦5m (5,000 units at ₦1,000 each).
- Coupon range: 16.25% – 16.75%.
- Pricing based on the yield of the seven‑year FGN bond plus a spread.
- Oversubscription of up to ₦1.23tn may be absorbed, allowing additional non‑cash bond allocations to GenCos.
Nigeria’s power sector has been crippled for years by NBET’s inability to settle GenCos’ invoices due to chronic under‑remittance by electricity distribution companies (DisCos).
- Current debt: ₦4tn, projected to reach ₦6tn by year‑end.
- Consequences: weakened gas supply contracts, power plants running below capacity, recurrent grid collapses, and unstable electricity supply nationwide.
Official Statements
Engr. Bashir Bayo Ojulari, Group CEO of NNPC Limited, described the bond as a major step toward resolving one of Nigeria’s most crippling financial crises.
Investor notices emphasized that the instrument carries a full sovereign guarantee, enjoys CBN liquidity status, meets PenCom compliance requirements, and is designed to support ongoing electricity market reforms.
CardinalStone confirmed that the Presidential Power Sector Debt Reduction Committee, chaired by the Minister of Finance, will lead investor engagement at a virtual forum on December 10, 2025, bringing together banks, pension fund administrators, insurers, and asset managers.
Despite optimism, some officials and GenCos have expressed caution, noting that the bond issuance has raised “more questions than answers” and requires further clarification at the scheduled meeting.
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