CBN Cuts Treasury Bills Rates, Rejects N1.07trn Excess Bids
The Central Bank of Nigeria (CBN) hacked spot rates on Nigerian Treasury bills across standard maturities, its primary market auction result has revealed. The authority offered N162 billion worth of Nigerian Treasury bills to investors across 91-day, 182-day, and 364-day maturities at the auction.
Total subscription was significantly heavy. Investors staked N1.233 trillion, outpacing the offer size by multiple folds, with the highest demand from instruments with long durations.
Details from the midweek auction showed that the CBN offered N22.02 billion worth of Nigerian bills with a 91-day tenor. Total subscription, however, came to N72.63 billion, and the CBN allotted N37.98 billion for the short tenor.
Also, N40 billion worth of 182-day bills was floated at the auction. Total subscription for 182-day Nigerian Treasury bills reached N63.56 billion, and allotment totaling N40.54 billion was made by the CBN.
For one year bills, there was an oversized subscription. The CBN offered to sell N100 billion worth of Nigerian Treasury bills with 364 maturity to investors. The total subscription recorded was more than 10 times the offer for the 364 bills offered, settling at N1.097 trillion.
Hence, investors staked a total of N1.23 trillion on N162.02 billion offered by the CBN at the competitive auction on Wednesday. Noting the direction, the oversized subscription afforded the authority a chance to reduce its balance sheet costs; hacked rates across the standard tenors.
The stop rate for Nigerian bills maturing in 91 days declined by 18 basis points to 17.80%. Also, spot rate on local treasury paper maturing in 182 days reduced by 15 basis points to 18.35%, and rate on one year bills was slashed to 18.84% from 19.35% Nigeria Boosts Trade Surplus to N5.17trn as Imports Taper
