Interbank Rates Little Changed as System Liquidity Tops N4.9trn

Interbank Rates Little Changed as System Liquidity Tops N4.9trn

Interbank rates remained largely unchanged as the money market remained flooded with excess liquidity of about N5 trillion on Tuesday, in the absence of funding pressures from active players.

The financial system liquidity expanded due to OMO bill repayments and sustained activity by deposit money banks (DMBs) at the Central Bank of Nigeria (CBN) deposit facility.

The excess liquidity balance kept the short-term benchmark money rates in check, reflecting the Apex Bank’s decision to allow OMO repayment flows without refinancing.

Market analysts reported that system liquidity improved from about ₦3.38 trillion in the previous session to ₦4.93 trillion on Tuesday, following a ₦2.22 trillion OMO repayment boost.

Investment firm AIICO Capital Limited told investors that the ₦2.22 trillion inflow that lifted the liquidity balance in the money market was from the 18 Aug 2026 OMO maturity.

Also, DMBs maintained active participation at the CBN’s SDF window, with placements settling at about ₦2.56 trillion on Tuesday, while there was no recourse for banks borrowing at the Standing Lending Facility. 

Given a sufficient credit balance in the money market, Nigerian Interbank Offered Rate (NIBOR) declined across most tenors on Tuesday, Cowry Asset Limited said in a note.

The Overnight rate edged up 1bp to 22.20%, while the Open Repo rate held at 22.00%.

In its market update, Herwood Securities Limited said the additional liquidity should continue to support the banking system and keep interbank funding conditions relatively comfortable.

“Interbank funding rates are expected to remain range-bound in the near term, supported by the improved system liquidity, although the effect of the FGN Bond auction settlement will partly offset the liquidity injection”, Herwood Securities Limited said. Nigerian Treasury Bills Yield Rises on Pre-Inflation Portfolio Reshuffles