CBN Raises N4.72 Trillion to Combat Excess Liquidity

The Central Bank of Nigeria (CBN) has intensified its efforts to manage excess liquidity by raising N4.72 trillion through Open Market Operations (OMO) auctions conducted on August 26 and 27. Investors submitted bids totaling N8.62 trillion for the short-term securities, indicating a strong demand for high-yielding assets.

The CBN had initially advertised N2 trillion across four auctions but ultimately allotted more than double that amount. The 132-day OMO attracted N3.48 trillion in subscriptions against N500 billion offered, with an allotment of N2.18 trillion at a stop rate of 19.65 percent.

The 152-day instrument received N3.29 trillion in bids for N500 billion, leading to an allotment of N1.77 trillion at 19.32 percent. The 96-day and 97-day instruments also saw significant interest.

The CBN's intervention comes amid N4.30 trillion in maturing securities and N762.89 billion raised through primary-market sales, resulting in a net liquidity withdrawal of about N1.19 trillion. Despite this, liquidity in the banking system remained substantial.