Nigeria Infrastructure Debt Fund raises payout as yields beat govt bonds

Nigeria’s first listed infrastructure debt fund increased its quarterly payout after posting another year of strong returns, underlining investor appetite for naira-denominated infrastructure assets that offer high yields and predictable cash flows.

The Nigeria Infrastructure Debt Fund (NIDF), managed by Chapel Hill Denham, announced a fourth-quarter distribution of N4.68 per unit for the period ended Dec. 31, 2025. Eligible unit holders will be paid on Feb. 5, funded entirely from cash generated during the quarter, according to the fund’s latest investor report.

The payout translates to a distribution yield of about 21%, one of the highest on the Nigerian Exchange, at a time when investors are seeking protection from inflation and currency volatility. Units of the fund last traded at N115, above its net asset value of N109.28 per unit.

The closed-end fund focuses exclusively on naira-denominated infrastructure loans and has built a portfolio of 20 investments spanning sectors such as pipeline networks, marine infrastructure, gas processing, telecom towers, off-grid solar, student accommodation and broadband internet. As of the end of December, its infrastructure loan portfolio had a weighted average annualised yield of nearly 20% and an average remaining life of more than seven years.

Chapel Hill Denham said the fund continues to outperform its benchmark, the 10-year Federal Government of Nigeria bond, with loans typically priced 300 to 500 basis points above the sovereign yield on a floating-rate basis. About 95% of the loans are floating rate, helping shield returns from rising interest rates.

The fund’s total return – assuming reinvestment of distributions – has climbed steadily since inception in 2017, reaching more than 415 by the end of 2025, up from a base value of 100. Net assets attributable to unitholders rose to N130.7 billion, compared with N113.8 billion a year earlier.

For the full year 2025, the fund generated profit after tax of N23.6 billion, while distributions paid and payable amounted to N21.9 billion. Cash and cash equivalents increased sharply, reflecting strong inflows from its loan portfolio.

Looking ahead, the fund has committed an additional N3 billion to new investments and approved two more transactions worth a combined 35.4 billion naira that are currently under documentation. These deals are expected to further diversify the portfolio and support Nigeria’s infrastructure financing needs.

The Nigeria Infrastructure Debt Fund is listed on both the Nigerian Exchange and FMDQ Exchange. It is overseen by joint trustees Stanbic IBTC Trustees and STL Trustees, with Citi Nigeria serving as custodian and PwC Nigeria as auditor, according to the report released by Chapel Hill Denham.