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Central Bank sells N132bn treasury bills

By on October 13, 2013

The Central Bank of Nigeria (CBN) sold N131.82 billion worth of treasury bills on Thursday, with maturities ranging between three months and one year with yields broadly flat, compared with the previous auction.

According to the Financial Market Dealers Association (FMDA), the central bank sold N20.15 billion worth of 91-day bills at 10.8 per cent, compared to the 10.85 per cent at the previous auction on September 26.

Also, the regulator sold N43.49 billion in the 182-day note at 11.64 per cent, slightly lower than the 11.69 per cent at the last auction, while a total of N68.18 billion of the 364-day debt was sold at 11.74 per cent, the same returns as at the previous auction.

Reuters revealed that total bid for the foxed income instrument was N250.55 billion compared to the N315.48 billion at the previous auction.

Meanwhile, the FMDA economic report for September has revealed that the rate of return in the Primary Market Auction (PMA) for treasury bills fell by 37 basis points for 91- and 182- day treasury bills, and 91 basis points for 364-day bills respectively last month, when compared to an average rate of the previous month.

The CBN allotted N331.22 billion in September, as against the N222.7 billion bills allotted in August 2013. This reflected a 48.73 per cent increase over the previous month’s figure.
“Subscription in the month also increased by 78.08 per cent to N850.88 billion relative to the N477.792 billion recorded in the previous month.

“At the first, second and third auction in the month under review, 91 days stop rates averaged 10.92 per cent as against 11.29 per cent last month; 182 days averaged 12.11 per cent relative to 12.47 per cent in August, while 364 days posted 12.17 per cent in the two auctions conducted relative to previous month’s 13.08.

“Available data revealed that the monetary authority further scaled back its use of Open Market Operations (OMO) for liquidity management, as the Cash Reserve Requirement (CRR) debits continue to influence system liquidity,” it added.

 

 

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