The Central Bank of Nigeria (CBN) raised ₦4.72 trillion through Open Market Operations (OMO) auctions conducted on August 26 and 27, after investors submitted ₦8.62 trillion in bids for the securities, highlighting strong demand for high-yield naira assets.
The amount raised was more than twice the ₦2 trillion initially offered across the four instruments, according to auction data reported from the CBN. The securities carried stop rates ranging from 19.32 percent to 19.90 percent.
The 132-day OMO bill attracted the highest level of subscriptions, with investors submitting ₦3.48 trillion against the ₦500 billion offered. The CBN allotted ₦2.18 trillion at a stop rate of 19.65 percent.
The 152-day instrument also recorded strong demand, attracting ₦3.29 trillion in bids against an offer of ₦500 billion. The CBN allotted ₦1.77 trillion at 19.32 percent.
Shorter-dated securities also attracted significant interest. Investors bid ₦1.07 trillion for the 96-day instrument, of which ₦160.46 billion was allotted at 19.85 percent. The 97-day instrument received ₦783.49 billion in bids, with ₦613 billion allotted at 19.90 percent.
The strong demand came as substantial funds were returning to the financial system from maturing securities. Market data cited in reports showed that about ₦4.30 trillion in primary-market securities matured during the period, while the government raised a further ₦762.89 billion through primary-market sales.
The CBN’s OMO sales therefore absorbed a significant portion of the liquidity entering the system. Market calculations put the resulting net liquidity withdrawal from the combined transactions at about ₦1.19 trillion.
The Financial Markets Dealers Association (FMDA), in its analysis of the August 26 auction, also reported strong investor participation, with ₦4.26 trillion in subscriptions against ₦1 trillion offered for the two instruments sold that day.
The latest auction results show that investors remain willing to commit substantial funds to naira fixed-income securities at yields close to 20 percent. For the CBN, the heavy demand also provides room to absorb liquidity while offering investors an avenue to deploy funds into short- and medium-term instruments.
The market will now watch subsequent OMO auctions for signs of whether demand remains this strong and whether yields begin to ease as liquidity conditions and investor expectations change.
