CBN ‘s N500 billion treasury bill sales oversubscribed by 53%

The Central Bank of Nigeria raised $530 million from Foreign Portfolio Investors on Friday, March 01, during the sale of N1.053 trillion (about $680 million) worth of Treasury bill sales. The CBN offered N500 Billion at the Open Market Operations (OMO) auction, which was oversubscribed by almost 53% or N530 billion, resulting in sales of N1.053 Trillion, with $530 million coming from foreign investors.

Friday’s auction marked the first one after the CBN’s Monetary Policy Committee meeting, followed by a virtual meeting with foreign portfolio investors. The auction featured three categories based on tenors: 95-day, 179-day, and 361-day OMO bills.

• For the 95-day bills, N75 billion was offered at a stop rate of 19.00 per cent, with a subscription and total sales of N37.05 billion.
• The 179-day bills had N75 billion on offer at a 19.5 per cent stop rate, with investors subscribing N8.25 billion, leading to CBN settling for N6 billion.
• The subscription levels for the 361-day OMO bill were strong, indicating increased investor appetite in the current economic environment.
• The 361-day bills had the highest rate at 21.5 per cent, with CBN offering N350 billion.

Bids ranged from 19.0000 per cent to 19.0000 per cent for the 95-day bills, 19.4600 per cent to 22.0000 per cent for the 179-day bills, and 20.6900 per cent to 23.5000 per cent for the 361-day bills, showcasing the diversity of investor expectations on yield. Some investors were willing to accept lower rates, while others aimed for higher returns.

Mrs. Hakama Sidi Ali, the Acting Director of the Corporate Communications Department at the Bank, emphasized the increased level of confidence that investors now have in the institution. Additionally, she expressed the Management of the CBN’s optimism regarding the positive outcomes resulting from its monetary policy measures.