The Central Bank of Nigeria (CBN) successfully conducted an auction of Nigerian Treasury Bills (NTBs) on March 27, totalling N1.64 trillion in sales.
The auction result report published by the apex bank indicated that the higher stop rates offered attracted investor interest, indicating an increasing confidence in the nation’s economic instruments.
During this latest auction, three categories of NTBs were offered, with 91 days, 182 days, and 364 days tenors with the allotment date following a day after, on March 28, 2024.
The auction report reflected that the shortest tenor bills, the 91-Day NTBs, offered an amount of N17.606 billion attracted a subscription of N76.812 billion, indicating a moderate demand level.
The bills have been set to mature on June 27 this year and range of bids for this category was fairly tight, ranging from 15.0000% to 22.0000%, showing a cautious investor approach. The stop rate for these bills was set at a competitive 16.2400%.
According to the apex bank, the 182-day NTBs showed higher demand, with an offered amount of N1.560 billion, a subscription of N58.184 billion. With maturity date set for September 26, 2024, these medium-term bills saw a bid range from 16.0000% to 22.0000%, indicating robust market optimism. Due to increased interest in mid-term investment, the final stop rate of 17.0000% was determined.
Similarly, the post-auction report by the apex bank indicated that the 364-Day bills, which have the he longest tenor, recorded a remarkable investor interest. For instance, with an offer of N142.162 billion, the bills recorded impressive subscription of N2.483 trillion, indicating a significant surge in investor confidence. The bills will mature on March 27, 2025.
As expected, the range of bids for the 364-day tenor was broader, spanning from 16.2390% to 25.4900%, highlighting the diverse expectations of investors. A stop rate of 21.5000% was finally settled for at the end of the auction, reflecting the higher yield sought by long-term investors.
