On 9 August 2026, Nairametrics reported that Geregu Power Plc had defaulted on its ₦40.09 billion Series 1 Senior Unsecured Bond, missing its eighth semi-annual coupon and scheduled fourth principal repayment. BusinessDay has described it as Nigeria’s first corporate bond default in seven years.
Beyond the headlines, what actually happens when a corporate bond defaults in Nigeria? The answer starts with the trust deed, the Companies and Allied Matters Act 2020 (“CAMA”) and the Investments and Securities Act 2025 (“ISA”).
A bond default does not automatically mean insolvency
A missed payment is first a breach of the terms governing the bond. The immediate question is contractual: has an Event of Default occurred, or is a cure or grace period still running?
CAMA’s debenture provisions and sections 281–287 of ISA 2025 provide the broader framework. But default does not make Geregu legally insolvent. The requirements for inability to pay debts under
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