Nigerian Banking System Excess Liquidity Climbs to N7.31trn
Keeping money market rates movements in check, surplus liquidity in the Nigerian banking system topped N7.3 trillion ahead of the Apex Bank’s anticipated open market operations.
System liquidity remained in surplus, edging up by ₦372 billion to ₦7.31 trillion on Monday, as banks continued parking funds at the Central Bank of Nigeria’s Standing Deposit Facility (SDF).
According to AIICO Capital Limited, Deposit Money Banks opened with ₦207.77 billion and placed ₦6.89 trillion at the SDF. No activity was recorded at the Standing Lending Facility, reflecting the absence of liquidity challenges among commercial banks.
Short-term funding rates were mixed, with the Overnight Lending Rate rising by 41 basis points (bps) to 20.81%, while the Open Repo (OPR) rate stayed unchanged at 20.00%.
Market analysts noted that total primary market repayments of ₦207.89 billion boosted excess cash in the financial system, and there was no OMO activity.
Money market records showed a ₦2.13 trillion inflow from OMO maturities and ₦260.67 billion in bond coupons, which will drive liquidity higher. However, a planned ₦800 billion T-bill sale may temporarily withdraw cash.
Meanwhile, the Treasury Bills secondary market closed bearishly, as subdued buying interest and cautious investor sentiment pushed yields up, with the average T-Bills yield rising 2bps to 17.93%. CBN Allots to Match as OMO Bills Subscription Hits N2.7trn
