Interbank Bank Rates Steady over Robust System Liquidity
Interbank rates were steadied due to excess liquidity in the money market, investment banking firms said in separate reports following the Central Bank open market operation action last week.
Deposit money banks continued to park cash into the Central Bank ahead of expected monetary easing in the first quarter of 2026.
No funding requests were recorded at the Standing Lending Facility window in the absence of funding pressures. Average daily liquidity in December eased by 1% to ₦3.23 trillion, from ₦3.35 trillion in November.
The short term interest rates settled at floor on the influence of recent asymmetric adjustment around the policy rate with interbank rates trailing 23% in the money market in the fourth quarter.
The financial system liquidity opened the first trading session of the New Year in positive territory at ₦3.36 trillion, although lower than the ₦3.89 trillion recorded at the close of the previous week.
Money market liquidity slightly lower week-over-week due to declining Standing Deposit Facility placements as 2025 raced to an end.
Market report indicated that the financial system funding profile had improved significantly to ₦5.15 trillion on December 30, supported by ₦594 billion in Open Market Operation maturities, and ended lower at ₦3.82 trillion on December 31 due to fewer SDF placements.
Banks placement settled at N2.92 trillion as financial institutions sought a 24.5% rate from the Apex Bank deposit facility. The week ended with system liquidity moderating to ₦3.36 trillion.
Notwithstanding the moderation in liquidity levels, interbank funding conditions remained stable, with both the Open Buy Back (OPR) and overnight rates unchanged week-on-week at 22.50% and 22.75%, respectively. First Holdco Declines by 8% to N2.043trn after Re-Rating
