Nigeria's Federal Government Settles $22.5M Charges on Loan

In the second quarter of 2026, the Federal Government of Nigeria paid $22.5 million in charges associated with its $1.5 billion Total Return Swap facility with First Abu Dhabi Bank (FAB). This payment was recorded as “other charges” in the latest external debt service records released by the Debt Management Office (DMO).

Notably, there were no principal or interest payments made on the Total Return Swap during the April-to-June period. The $22.5 million charge represents 1.5 percent of the $1.5 billion drawn from a broader $5 billion financing program approved for the Federal Government.

The DMO did not specify what the charge covered, leaving its nature unclear. The Total Return Swap arrangement allows Nigeria to secure dollar liquidity while using naira-denominated Federal Government securities as collateral.

The facility has a six-year tenor with a break option after three years, and the first drawdown was priced at the Secured Overnight Financing Rate plus 395 basis points.