CBN hikes rate on 364-Day Nigerian Treasury Bills

Central Bank of Nigeria (CBN) increased the spot rate on Nigerian Treasury billls with 364-day maurity to 16.50%, according to details from its primary market auction results on Wednesday. The Apex Bank, through the Debt Management Office (DMO), opened N220 billion in Treasury bills across standard tenors for subscription on Wednesday. The offer was significantly oversubscribed, with investors showing interest in long duration. The CBN offered Nigerian Treasury bills with 91 days maturity worth N60 billion for investors subscription. At the mid tenor, 184-day treasury bills worth N20 billion was opened for sale. One year treasury bills worth N140 billion was also in the CBN offer bucket.
Total subscription at the auction reached N366.55 billion, according to the primary market auction results obtained by MarketForces Africa.
Breakdown of the aggregate subscription submitted by investors showed preference for 364-day bills remained solid. Investors staked N323.08 billion on Nigerian Treasury bills with 364 days maturity, 2.31 times above N140 billion offered by the CBN. The spot rate for Nigerian Treasury bills with 364 days maturity, which received N139.59 billion allotment, inched higher to 16.50%, up by 62 basis points from 15.88% discount rate at the previous auction. Investors’ subscriptions for 91 days bills reflect a lack of interest in short durations. Total demand settled at N22.60 billion as against N60 billion offer, while the authority maintained the spot rate at 15% and approved N15.33 billion for investors. At the belly of the curve, the market recorded mild interest from local investors seeking high return on investment. Total subscription for 182 days Nigerian Treasury bills printed at N20.87 billion, a little higher than N20 billion offered by the authority. The spot rate remained unchanged at 15.50% for N18.32 billion allotment.