Nigerian Banks Struggle with Liquidity Amid CBN's N3.7 Trillion Treasury Sales
Nigerian banks are experiencing tighter liquidity as the Central Bank of Nigeria (CBN) conducted large-scale sales of Treasury and Open Market Operations (OMO) bills totaling N3.7 trillion. Despite repayments and inflows, the system faced a cash deficit of N2.5 trillion, causing liquidity constraints.
The CBN's cautious issuance approach and strong demand for longer-dated bills helped limit yield increases. The market saw a rise in average Treasury bill yields by 15 basis points, reflecting investor preferences for longer-term returns.
The CBN's move to grant fintech companies and microfinance banks approval to expand digital banking services nationwide aims to enhance financial access. Despite expectations of increased inflows, a bearish sentiment persists in the secondary market.
Plus234Feed summary based on reporting from Legit.ng. Read the original report below.
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