Investors placed N8.62tn worth of bids for the Central Bank of Nigeria’s Open Market Operations securities in two days, as yields on the short-term instruments climbed as high as 19.90 per cent.The strong demand enabled the CBN to raise N4.72tn through four OMO auctions conducted on 26 and 27 August, exceeding its combined advertised offer of N2tn.
The auctions covered maturities ranging from 96 to 152 days and show continued investor appetite for high-yielding naira assets amid substantial liquidity in the financial system.
The 132-day OMO attracted the largest volume of subscriptions, with investors bidding N3.48tn for N500bn offered by the apex bank.
The CBN subsequently allotted N2.18tn at a stop rate of 19.65 per cent.
The 152-day instrument generated another N3.29tn in bids against a N500bn offer, while N1.77tn was eventually allotted at 19.32 per cent rate.
Demand was comparatively lower for the shorter instruments, although both were oversubscribed.The 96-day OMO attracted N1.07tn in subscriptions, with N160.46bn allotted at 19.85 per cent.Similarly, the 97-day instrument received N783.49bn in bids and recorded an allotment of N613bn at 19.90 per cent, the highest stop rate among the four auctions.
The auction results showed an unusual yield pattern, with the longest-dated instrument clearing at a lower rate than the shorter bills.Market participants appear to have shown a preference for locking in returns for longer periods, despite accepting lower annual yields. The latest OMO sales came as billions of naira entered the financial system from maturing government securities.