Nigeria has received the first $1.5 billion payment from its $5 billion financing deal with First Abu Dhabi Bank, FAB.
The federal government got the funds in the last two weeks through a structured total return swap, TRS, with the UAE’s biggest bank, Bloomberg reported Friday citing sources familiar with the deal.
The drawdown follows National Assembly approval on March 31 for President Bola Tinubu’s request to borrow up to $6 billion externally. That package includes the $5 billion TRS facility from FAB plus another facility from the UK.
Tinubu said the borrowing will add to Nigeria’s public debt, which was $110.3 billion, about N159.2 trillion, as of Dec. 31, 2025.
The move comes despite warnings from Fitch Ratings and the IMF. Fitch said deals like this can boost liquidity and cut costs, but they often sit outside normal debt reporting. That could reduce transparency and legislative oversight. Fitch also flagged extra foreign exchange risk if bond yields rise or the naira weakens.
The IMF added that derivative-based financing is often complex and opaque, making it hard to measure a government’s full debt burden.
