Yield Rises to 25.64% as Banks Liquidate T-Bills Holdings
As banks sold their holdings to satisfy funding demand, the average yield on Nigerian Treasury bills increased to 25.64% in the secondary market.
Trading activities were subdued, with some actions at the long end of the curve, particularly for the December bills. The sell-side actors outpaced the buying actions in the secondary market due to a liquidity crunch in the financial system.
Market participants’ ability to increase positions on naira asset holdings was tamed by expanding the deficit in the banking system, totalling N1.02 trillion.
While the market experienced sell pressures across the curve, there was demand for some papers. Fixed income securities investors took their chances on 85-day maturity bills and 337-day to maturity bills, the action that caused 2 basis points yield expansions on each paper.
Meanwhile, sell pressure hit the 113-day to maturity (+115bps) bill as portfolio managers continue to adjust their portfolios for optimum returns. Traders said sell actions occurred for the December 9, 2025 bill, with execution rates around low 23.00% levels.
“While demand emerged for selected papers across the yield curve, it was offset by selling pressure from investors seeking to raise liquidity.” The 10-Apr maturity experienced the biggest increase in yield, advancing by 115 bps.
In contrast, the 9-Oct and 6-Nov papers recorded the sharpest declines in yield, according to TrustBanc Financial Group. Overall, the average benchmark yield advanced by 9 bps to close at 25.64%.
Meanwhile, the average yield contracted by 5 basis points to 27.3% in the OMO bills segment. #Yield Rises to 25.64% as Banks Liquidate T-Bills Holdings Interbank Rates Slow as Remita, FAAC Credits Boost Liquidity
