The Lagos State Government has unveiled plans to issue N1tn worth of asset-backed securities in the first quarter of 2026 as part of an ambitious strategy to unlock value from public assets and deepen Nigeria’s capital market.
The Commissioner for Finance, Oluyomi Abayomi, announced the initiative at the Investment Banking Awards Dinner of the Association of Issuing Houses of Nigeria, held in Lagos on Thursday. He described the move as a significant extension of the state’s financing reforms, following the successful completion of a N200bn bond programme earlier this year.
According to him, the forthcoming securitisation programme will leverage assets currently under state management, with a combined valuation exceeding N1tn. “One of the instruments that will be introduced in the first quarter of next year is an asset-backed security. We are going to be securitising the assets that we are currently managing, worth over N1tn,” he said.
The commissioner further disclosed that several local government areas in Lagos are preparing to access the capital market through municipal bond issuances, expected in the first half of 2026. The move forms part of broader efforts to strengthen subnational financing, diversify funding sources, and maintain market vibrancy.
Abayomi emphasised that Lagos’ financing initiatives are structured to reinforce investor confidence, improve market liquidity, and create sustainable channels for delivering infrastructure and developmental projects across the state. He cited the oversubscription of the state’s N200bn 10-year bond and its N14.815bn green bond—the first issued by any subnational government in Nigeria—as evidence of robust market appetite. “We came to the market seeking to raise about N200bn; we ended up raising about N400bn,” he noted.
Commenting on the wider implications for the capital market, the Chief Executive Officer of Nigerian Exchange Limited, Jude Chiemeka, said the planned instruments would broaden product offerings and encourage long-term investments. “It’s a good thing because it will help deepen the offering in the capital market. The market has long been dominated by debt and equity instruments, and high interest rates in recent years discouraged long-term bond issuance. Now that inflation and interest rates have been coming down, it creates opportunities for corporates to return to the market,” he said.
Chiemeka added that asset-backed securities would unlock dormant assets and establish new pathways for capital raising, thereby strengthening the market from both the trading and issuance sides. He revealed that the NGX had facilitated N7.3tn in capital raising year-to-date across multiple asset classes and restated the Exchange’s readiness to support the rollout of asset-backed instruments and municipal bonds.
