CBN Raises N1.5trn from OMO Bills at Interest Rate of 23.87%
The Central Bank of Nigeria (CBN) raised N1.5 trillion from its open market operations on Monday, where the authority made a N600 billion OMO bill offer size to deposit money banks and foreign portfolio investors.
On Monday, the monetary authority conducted a primary market auction and offered to sell OMO bills worth N600 billion to mop up excess liquidity of N1.35 trillion in the financial system.
The OMO bills offered to investors were split across the 113-day and 204-day papers. Analysts reported that demand was heavily concentrated in the 204-day tenor, according to CardinalStone Securities Limited.
The investment firm said the OMO auction attracted subscriptions worth N1.6 trillion, while the shorter-dated paper saw no bids. The CBN eventually allotted N1.5 trillion at a stop rate of 23.87%, CardinalStone said.
Last week, the OMO bills segment witnessed firm buying interest, particularly at the short and long ends, where yields declined by 31 bps to 25.53% and 25 bps to 23.49% per annum.
The medium segment saw a 30 bps contraction to 24.64%, resulting in a marginal 1 bp uptick in average OMO yield to 24.70% from 24.69% the previous week, according to Coronation Research. #CBN Raises N1.5trn from OMO Bills at Interest Rate of 23.87% Yield on Nigerian Treasury Bills Falls as CBN Cuts Rates
