Nigeria’s Central Bank has introduced a special 90 days tenor bill with zero coupon as part of efforts to deepen the financial markets.
The special bill also avails the monetary authority with an additional management tool. In circular dated December 1, 2020, and signed by Bello Hassan, director, banking supervision, the applicable yield at issuance will be determined by the CBN.
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The instrument will be traded amongst banks, retail and institutional Investors. It will qualify as liquid assets in computation of liquid ratio for deposit money banks.
According to the circular, the instrument shall not be accepted for repurchase agreement transactions with the CBN and shall not be discounted at the CBN window.
The CBN will continue to ensure optimal regulation of systemic liquidity and promote efficient financial markets in support of economic recovery and sustained growth, Hassan stated in the circular
