CBN sells N1.64 trillion treasury bills, targets investors

The Central Bank of Nigeria (CBN) has auctioned N1.64 trillion worth of treasury bills.

According to the Nigerian Treasury Bills (NTBs) on March 27, 2024, the higher stop rates offered, attracted considerable investor interest, which reinforces the growing confidence in Nigeria’s economic instruments.

The report highlighted that three categories of NTBs were offered, with varying tenors of 91 days, 182 days, and 364 days. The auction date was on March 27, 2024, with the allotment date following a day after, on March 28, 2024.

In the three categories, there were 182-day NTBs that showed higher demand, with an offered amount of N1.560 billion and a hefty subscription of N58.184 billion.

The maturing date for this is September 26, 2024, these medium-term bills saw a bid range from 16.0000 per cent to 22.0000 per cent, signalling robust market optimism. As interest in mid-term investment vehicles increased, a final stop rate of 17.0000 per cent was determined.

The 364-Day bills, which had the longest tenor witnessed a huge had a huge turnout.

With an offer of N142.162 billion, it garnered a subscription of N2.483 trillion, indicating a significant surge in investor confidence. These bills will mature on March 27, 2025.

The range of bids for the 364-day tenor was broader, spanning from 16.2390 per cent to 25.4900 per cent, highlighting the diverse expectations of investors. A stop rate of 21.5000 per cent was eventually settled upon, reflecting the higher yield sought by long-term investors.

The shortest treasury bills were those of were pegged at 91-day offered an amount of N17.606 billion, attracting a subscription of N76.812 billion, indicating a moderate demand level. The bills have been set to mature on June 27 27, 2024.

The range of bids for this category was fairly tight, ranging from 15.0000 per cent to 22.0000 per cent, showing a cautious investor approach. The stop rate for these bills was set at a competitive 16.2400 per cent.

In the meantime, the Federal Government has directed banks to deduct 0.375 per cent stamp duties on all loan facilities. The directive said the deduction would be made on the principal loan amount.

This development was confirmed by some customers who received text messages that conveyed the directive.

The text message read in part: “Dear Valued Customer, we write to inform you that the Federal Government of Nigeria has directed that all banks remit stamp duty on all loans. In line with this directive, 0.375 per cent of every principal loan amount disbursed will be debited and remitted to the Federal Government of Nigeria. However, all existing approved loans remain unchanged and are to be fully repaid in line with the terms and conditions. We are committed to offering you exceptional service every step of the way.”

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