First Abu Dhabi Bank (FAB), the United Arab Emirates’ largest lender, is considering transferring part of its exposure to Nigeria’s $5 billion total-return swap (TRS) to other financial institutions, potentially broadening the number of lenders participating in the arrangement.
The development was reported by Bloomberg and subsequently published by BusinessDay on October 1, 2026, citing people familiar with the discussions.
Under the proposed arrangement, FAB could retain its position as the Nigerian government’s contractual counterparty while allowing other banks to assume portions of the financial exposure associated with the transaction.
The discussions are reportedly centred on whether sufficient interest exists among other financial institutions to participate.
How the Proposed Arrangement Could Work
A syndicated exposure arrangement would allow FAB to distribute part of its position among participating lenders rather than retain the entire economic exposure on its own balance sheet.
Under the structure described in the report, FAB would continue to face the Nigerian government under the swap, while other banks could take agreed portions of the exposure through a participation arrangement.
FAB could also earn additional fees for arranging such participation.
The discussions do not, by themselves, establish that any transfer has been completed or that new lenders have formally joined the transaction.
Implications for Nigeria’s Financing Arrangements
The reported development places renewed attention on the structure of Nigeria’s large financial transactions and how international lenders manage their exposure to sovereign counterparties.
For participating banks, such arrangements can provide a way to distribute risk while maintaining involvement in a transaction. For Nigeria, the important considerations include the terms of the agreement, its financial obligations and the potential costs associated with the arrangement.
The Federal Government’s Debt Management Office published an official frequently asked questions document on the $5 billion total-return swap with FAB on August 28, 2026.
Debt Management Office Nigeria
The reported discussions remain subject to market interest and the terms agreed by the parties.