By Dipo Olowookere
The Central Bank of Nigeria (CBN) did the unthinkable at the primary market auction (PMA) on Wednesday when it marginally raised the stop rates of two of the three tenors of treasury bills it offered for sale to investors.
The apex bank had rolled over a total of N223.22 billion worth of maturing treasury bills across three maturities yesterday with expectations that the rates would be further sliced like it had done in the previous exercises.
However, the stop rates on the short-dated instrument as well as the long-dated maturity were slightly increased during the auction, while the rate on the mid-tenor bill was lowered.
The bank had offered for sale N28.92 billion worth of the 91-day instrument to investors, but received offers valued at N47.96 billion, with N28.02 billion allotted.
For the 182-day tenor, the CBN auctioned N58.68 billion with subscriptions worth N72.24 billion received and N33.68 billion eventually sold.
Lastly, N136.52 billion worth of the 364-day bill was offered to investors at yesterday’s exercise, with bids valued at N253.93 billion received from subscribers and N161.52 billion allotted to investors.
Business Post reports that the central bank reduced the stop rate for the 182-day maturity by 0.15 percent yesterday to 10.60 percent from 10.75 percent.
For the 91-day tenor, the rate was marginally increased by 0.01 percent to 9.75 percent from 9.74 percent, while that of the 364-day instrument was slightly raised by 0.04 percent to 11.18 percent from 11.14 percent.
A look at the secondary market on Wednesday indicated a mixed sentiment as more of the attention was on the PMA.
Adedapo Adesanya