FG spends N1.79 trillion on domestic debt service in 3 months–DMO

The Federal government spent around N1.79 trillion on servicing its domestic debt between July and September 2023.

This is according to the domestic debt service report for the third quarter published by the Debt Management Office (DMO).

According to the report, the federal government paid interest on NTBs, FGN bonds, treasury bonds and FGN savings bonds during the period.

In July, the total domestic debt service stood at N268.10 billion. This comprises interest payment on NTBs worth N27.84 billion, FGN bonds interest payment of N240.08 billion and FGN Saving bonds interest payment of N178.51 billion.

In August, the domestic debt service payment rose to N696.52 billion. During the month, interest payment on NTBs stood at N34.83 billion while that of FGN bonds was N661.42 billion. The debt service payment on FGN savings bonds was N262.56 billion.

The federal government made a total debt service payment of N827.84 billion for September. This is made up of N51.99 billion on NTBs, 739.11 billion on federal government bonds interest payments, and N8.3 billion as rentals for FGN Sukuk bonds.

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In September, the federal government also paid interest of N304.87 billion on FGN Savings bonds and a further N3.12 billion as interest on Treasury bonds. The FG also paid N25 billion as a principal payment during the month.

The DMO further stated that the interest payment on FGN bonds for September comprises securitised Ways and Means for September 2023 which is not yet verified. It also noted that “all FGN Securities that matured during the period were refinanced except for Treasury Bonds and Promissory Notes with Sinking Fund provision.”

The total domestic debt service payment of N1.79 trillion for the third quarter of  2023 represents an increase of 107.16 per cent when compared to the domestic debt service of N820.59 billion in the third quarter of 2022– one year ago.

When compared with the preceding quarter, the federal government’s total debt service payment increased by 102.45 per cent between the second quarter and third quarter of 2023. In the second quarter of the total debt service payment stood at N849.58 billion.

In the first nine months of the year, the federal government has spent around N4.13 trillion on domestic debt service.