Onome Amuge
Lagos State has made history in Nigeria’s capital markets, sealing two landmark bond issuances worth a combined N244.815 billion, cementing its reputation as a trailblazer in sub-national debt and sustainable finance.
The twin transactions, announced on Thursday, included a N14.815 billion Series III Green Bond (the first certified green bond issued by any Nigerian state) and a N230 billion Series IV Conventional Bond, now the largest sub-national bond ever recorded in Sub-Saharan Africa. Both issuances are part of Lagos State’s N1 trillion debt and hybrid instruments issuance programme, aimed at financing a range of infrastructure and urban development projects across the commercial hub.
Governor Babajide Sanwo-Olu, speaking at the launch event attended by investment professionals, partners, and state officials, described the milestone as “historic” and reflective of Lagos’ ongoing commitment to climate-friendly infrastructure, sustainability, and responsible public finance.
“The Series III Green Bond reflects our dedication to financing projects that directly support the UN Sustainable Development Goals and deliver measurable environmental benefits. Our bond is certified by the globally recognised Climate Bonds Initiative (CBI), reinforcing our adherence to international green finance standards,” Sanwo-Olu said.
The Series III Green Bond attracted N29.29 billion in bids, nearly double the N14.815 billion on offer, highlighting strong investor appetite for environmentally aligned state projects. Meanwhile, the Series IV Conventional Bond, initially targeted at N200 billion, saw oversubscription to N310.06 billion. Lagos activated its green-shoe option to accommodate excess demand, ultimately raising N230 billion.
According to the state government, the proceeds from both bonds will fund strategic infrastructure projects, including the expansion of the Blue and Red Rail Lines to ease urban mobility, construction of the Lekki-Epe Airport Road, development of affordable housing, upgrading healthcare facilities including a 280-bed hospital, deployment of solar power across schools, and establishment of agro-produce hubs to boost food security.
Abayomi Oluyemi, Lagos State commissioner for finance, emphasised that the issuances align with global sustainability benchmarks and reaffirm the state’s position as a leader in sub-national capital markets. “These issuances will directly support critical infrastructure across transport, environment, healthcare, education, and sustainable urban development, while upholding transparency and prudent financial management,” he said.
Market participants applauded the transactions as a new benchmark for sub-national finance in Africa. Bolaji Balogun, CEO of Chapel Hill Denham, noted: “Lagos State has achieved two market firsts: the first certified sub-national green bond in Africa and the largest sub-national bond issuance in the region. These milestones showcase world-class transparency, compliance, and investor confidence.”
