Lagos State’s N200 billion bond will fund four priority projects that cost N811.4 billion in total. The bond covers less than a quarter of that, and none of the four projects will be finished with the money raised.
The Series 5 pricing supplement shows net proceeds of N195.46 billion after offer costs of N4.54 billion. Of that, 62.5% (N122.2 billion) goes to the Blue Line Rail Project – Section II, Sub-Phase V (Mile 2 – Okokomaiko).
The New Massey Children Hospital gets 15% (N29.3 billion), the Omu Creek road and bridge in Ibeju-Lekki 12.5% (N24.4 billion), and the 280-bed Ojo General Hospital 10% (N19.5 billion).
The 10-year bond closes on Friday, Oct. 16, with coupon guidance of 16.50% to 16.75%.
Lagos has already spent N265.8 billion on the four projects. After this bond, about N350 billion of their cost will still be unfunded, on MoneyCentral calculations, and N236 billion of that is for the Blue Line.
The Pricing Supplement seen by MoneyCentral puts the total value of that section of the Blue Line Project at N461 billion, with N102.58 billion paid to date and current completion level put at 42%. With the N122 billion to be injected by the bond proceeds, the expected completion level will rise to 68%, but there will still be N236 billion needed to complete the project.
With the new bond money, the Massey hospital should reach 96% and the Ojo hospital 92%, so neither will be finished.
Omu Creek shows the clearest gap between spending and construction. Lagos has paid 58% of the N141.7 billion contract, but only 35% of the work is done.
After this bond, payments will reach about 76% of the cost and completion only 52%. That works out to about N36.2 billion per kilometre for the 3.9km road and its bridge. For the Ojo hospital it is 75% built but only 30% paid for.
The bonds are unsecured. They will be repaid from a sinking fund that receives N3.40 billion a month, rising to N4.57 billion once principal repayments begin, drawn from the state’s debt service account and from direct deductions from its federal allocations.
On MoneyCentral estimates, those deposits cover expected debt service with about a 19% cushion. The issue is rated Aa by Agusto & Co. and AA by GCR.
The risks are on the balance sheet and in the courts. Lagos had total debt of N3.09 trillion at the end of 2025.
Claims in lawsuits against the state have jumped to N878.5 billion across 114 cases, up from N82.6 billion according to its 2023 prospectus.
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