CBN Slashes One-Year Treasury Bills Rate to 5.20%

By Dipo Olowookere

The stop rate of the one-year treasury bills has again been slashed by the Central Bank of Nigeria (CBN) when it auctioned some notes at the primary market on Wednesday, February 9, 2022.

This was mainly influenced by the significant appetite of investors for the maturity during the exercise.

Details of the auction indicated that N90.2 billion worth of the 364-day bill was put up for sale but the value of subscriptions was N441.5 billion and with this high hunger for the tenor, the apex bank found an easy urge to cut down the rate.

Business Post reports that the apex bank allotted N211.2 billion to traders with the stop rate clearing at 5.20 per cent compared with the previous rate of 5.40 per cent.

However, due to a low appetite for the 91-day and 182-day bills, the central bank left their respective stop rate intact.

According to the results of the exercise, N4.1 billion worth of the short-term paper was auctioned at the primary market, but the subscriptions stood at N2.2 billion, with N1.9 billion allotted at 2.48 per cent, the same stop rate of the preceding exercise, which was two weeks ago.

As for the six-month bill, the apex bank, which conducted the PMA for the Debt Management Office (DMO), offered for sale N3.8 billion but the bids received were N2.6 billion, with N1.8 billion sold to traders at 3.30 per cent.

At the close of the sales, the CBN sold treasury bills valued at N214.9 billion, lower than the N98.1 billion brought to the market and lower than the N446.3 billion investors had wanted to purchase.