Post-Auction Selloffs Trim Nigerian Treasury Bills Yield
The average yield on Nigerian Treasury (NTB) bills surged in the secondary market as investor demand for fixed-interest securities weakened on Monday.
Sell pressure was noted across the short, belly, and long ends of the curve in the secondary market amid the latest increase in spot rates.
Broad street fixed-income market analysts said investors rotated their positions into riskier equities as the Nigerian Exchange rebounded after sharp profit-taking.
The Apex Bank OMO bills auction tightened liquidity levels, and some asset managers and portfolio holders trimmed their Treasury bills holdings in search of cash.
Hence, the average T-Bills yield edged up by 5 bps to close at 17.59%, pointing to softening investor demand and a broadly negative tone across the fixed-income space. Last week, the Central Bank offered N1 trillion across the 91-day, 182-day, and 364-day Nigerian Treasury Bill tenors.
Investor demand was mixed across the curve, with the 91-day and 364-day instruments recording subscription rates of 131.18% and 243.26%, respectively, while the 182-day bill was undersubscribed at 83.55%.
Demand was particularly concentrated at the long end of the curve, as the 364-day bill attracted nearly N1.95trn in subscriptions against an offer size of N800 billion, highlighting investors’ preference forlonger-dated securities in the current interest rate environment.
On the allotment side, the 91-day bill was fully allotted, while the 182-day bill was mostly allotted, with less than 1% of subscriptions rejected. Meanwhile, only 63.88% of bids received for the 364-day tenor were successful, reflecting the significant oversubscription recorded at the auction.
Stop rates settled at 16.05%, 16.19%, and 16.35% for the 91-day, 182-day, and 364-day bills, respectively, with the one-year tenor recording the first upward revision in its stop rate in several months.
This suggests that the CBN was able to accommodate strong investor demand at higher yield levels CBN Raised N4.5trn from OMO, Treasury Bills Auctions

