CBN Mops Up N2.6trn Via Treasury Bills Sales in 6-Month
The Central Bank of Nigeria (CBN) mopped up about N2.6 trillion in the first half of 2023 as part of an effort to manage the liquidity level in the economy. In a report, the apex bank said the total value of Nigerian Treasury Bills (NTBs) comprising 91-day, 182-day, and 364-day tenors it offered and allotted was ₦2,599.91 billion apiece.
This indicates an increase of ₦184.33 billion or 7.09 per cent above ₦2,415.58 billion issued and allotted apiece, in the corresponding period in 2022, the apex bank said. According to the report, total public subscriptions stood at ₦9,502.78 billion, compared with ₦4,663.18 billion in the corresponding period in 2022.
The Bank said the high subscription was largely attributed to investors’ increased appetite for high yield on risk-free securities coupled with the prevailing liquidity conditions.
The structure of the allotment of the instrument indicated that deposit money banks including foreign investors took up ₦1,999.10 billion or 76.89 per cent, and merchant banks took up ₦281.49 billion or 10.83 per cent.
Meanwhile, the Federal Government’s domestic debt instruments remained the principal source of domestic financing with increased reliance on medium to long-term debt issuances in line with the debt management strategy, the apex bank report stated. In the first half of 2023, there was a build-up in FGN domestic debt stock due to increased borrowings and conversion of pre-existing FGN ways and means advances to FGN Bonds.
The report said mandate and internal funds customers accounted for the balance of ₦319.32 billion or 12.28 per cent. The stop rates in the market ranged from 0.1000 – 6.0000 per cent for 91-day, 0.30000 – 8.0000 per cent for 182-day and 2.2400 – 14.7400 per cent for 364-day tenors.
The range of stop rates in the corresponding period of 2022 was 1.7400 – 2.5000 per cent for the 91-day, 3.0000 – 3.8900 per cent for the 182-day and 4.0000 – 6.4900 per cent for the 364-day tenors The aggregate value for NTBs outstanding was ₦4,722.72 billion at the end of June 2023, according to the report. BUA Reduces Cement Price, Plans Further Review
The apex bank said the holding structure indicated that deposit money banks accounted for ₦2,022.37 billion (42.82 per cent), parastatals accounted for ₦1,347.39 billion (28.53 per cent), mandate and internal account customers accounted for ₦1,297.40 billion (27.47 per cent).
The report added that the merchant banks accounted for the balance of ₦55.57 billion (1.18 per cent), at end-June 2023.
“In the corresponding period of 2022, the NTBs outstanding totalled ₦4,504.80 billion with the DMBs accounting for ₦2,275.12 billion (50.50 per cent), parastatals accounted for ₦1,212.03 billion (26.91 per cent), mandate and internal account customers accounted for ₦988.26 billion (21.94 per cent), while merchant banks accounted for the balance of ₦29.38 billion (0.65 per cent)”, the report stated.
#CBN Mops Up N2.6trn Via Treasury Bills Sales in 6-Month