CBN to issue N1.2trn treasury bills in Q3

The Central Bank of Nigeria (CBN) plans to issue a total of N1.2 trillion treasury bills in the third quarter of 2022 as the same amount will be maturing between June 2022 and August this year.

The CBN stated this in the Nigerian Treasury Bills issuance programme calendar released on its website on Friday.

On a year-on-year basis, the planned issue was 99.8 percent higher than N722.17 billion issued in the corresponding year of 2021.

The breakdown of the T-bills programme to be issued in the next three months, which also represents the amount that would mature during the same period, consists of a total of N33.4 billion for 91-day tenor, N21.9 billion for 182-day tenor and N1.17 trillion for 364-day tenors.

The CBN issues Treasury Bills twice in a month to help the Federal Government fund its budget deficit, support banks in managing liquidity in the system and curb inflation.

Read also: Investors expect higher rate as CBN pays maturing treasury bills Wednesday

Nigerian Treasury Bills (NTB) as defined by the CBN are short-term securities issued at a discount for a tenor ranging from 91 to 364 days, such that the income received is the difference between the purchase price and the amount received at maturity or prior to the sale.

On Wednesday at the Primary Market Auction (PMA) the CBN rolled over a total of N164.1 billion for 364-Day tenor instruments, N790 million for medium-term (182-day), and N2.3 billion for short-dated (91-Day) tenor instruments.

The Nigerian treasury bills (NT-Bills) secondary market closed on a negative note on Friday with the average yield across the curve increasing by 15 bps to 4.35 percent from 4.20 percent on the previous day.

A market report by FSDH research noted that average yields across short-term, medium-term and long-term maturities expanded by 5 bps, 15 bps, and 22 bps, respectively. NTB 27-Apr-23 (+109 bps) maturity bill witnessed maximum selling pressure.

The Overnight (O/N) rate increased by 6.50 percent to close at 14.00 percent as against the last close of 7.50 percent, and the Open Repo (OPR) also increased by 6.50 percent to close at 13.75 percent as against the last close of 7.25 percent. Money market rates increased by an average of 650 bps following the foreign exchange retail auction by the CBN.