OVERVIEW
AIICO Eurobond Fund is an open-ended Dollar denominated mutual fund, strategically investing in high-quality Nigeria sovereign & non-sovereign Eurobonds and in investment-grade money market instruments.
INVESTMENT OBJECTIVES
The investment objectives of the fund is to offer investors the opportunity to diversify their portfolios, ensure long term appreciation and capital preservation while generating a steady stream of income on USD denominated securities.
INVESTMENT OBJECTIVES
The AIICO Eurobond Fund delivered YTD return of 6.88% in June 2026, c.419bps above its benchmark of 2.69%.
Global markets digested the aftermath of the Israel-Iran-U.S. conflict, which drove Brent crude to a post-war peak above $126.41/bbl. Prices retreated sharply through the month as a ceasefire and subsequent US-Iran peace framework took hold, easing the geopolitical risk premium that had weighed on frontier and emerging market earlier in the year.
Nigeria’s Eurobond market traded on a strong bullish footing before losing momentum as global rate expectations shifted through the second half of the month. Average benchmark yields compressed to around 6.78% before drifting back out to close the month near 7.08%, as offshore investors reassessed frontier-market risk against a firmer-for-longer US rate backdrop. This was underpinned by improving domestic macroeconomic sentiment and easing geopolitical risk following reports of progress in US-Iran ceasefire talks, which supported broader risk-on positioning toward frontier sovereign debt.
The increase suggests a modest repricing following the strong compression witnessed earlier in the year. Despite the uptick, Nigerian Eurobond yields remain below levels observed at the beginning of the second quarter, indicating that investor confidence in the country’s external debt market remains relatively firm with external reserve continuing their strong build through June, crossing $50.12 billion on 5 June and reaching $51.04 billion by 18 June 2026, hitting the CBN’s full-year target and the highest level since 2009.
Outlook: SSA Eurobonds are likely to remain sensitive to the trajectory of the US-Iran conflict and its knock-on effects on oil prices and global risk appetite. With focus centered on the durability of any Middle East de-escalation, the path of US rate policy, and Nigeria’s continued fiscal and reserve accumulation momentum.
