FG pays $22.5m in charges on controversial UAE loan

In the second quarter of 2026, the Federal Government of Nigeria paid $22.5 million in charges on its controversial $1.5 billion Total Return Swap financing from First Abu Dhabi Bank (FAB). The payment accounted for 1.5 percent of the amount drawn from the $5 billion financing program. The Debt Management Office (DMO) classified the charges as "other charges" without detailing the exact nature of the fees.

Nigeria had secured a Total Return Swap program of up to $5 billion with FAB earlier in the year, seeking to raise external financing for the 2026 budget and manage its debt obligations. The swap structure differs from Nigeria's conventional Eurobond borrowing, and its cost, collateral requirements, and potential exposure to market movements have been subjects of scrutiny.

The transaction has a six-year tenor, with the first drawdown priced at SOFR plus 395 basis points and subsequent tranches expected to carry a spread of about 400 basis points.