Total subscriptions in the Central Bank of Nigeria’s (CBN) Open Market Operation (OMO) auction which held on February 13, 2025 hit N1.915 trillion.
Though the significant investor participation is an indication of continued confidence in CBN’s liquidity management instruments, the demand was noticeably lower compared to the January 31, 2025 auction.
The CBN increased the total volume of successful bids, selling N1.395 trillion worth of OMO bills, a 39.5 per cent increase from the N1 trillion sold in January.
In the February auction, the CBN offered two subscription tenors: a 355-day bill and a 362-day bill, with both instruments having an initial offer size of N300 billion each.
Investors appeared to be more interested in the 362-day bill where total subscriptions soared to N1.499 trillion, exceeding the amount on offer.
The 355-day bill which was also oversubscribed, saw a relatively lower subscription level of N415.85 billion, causing the CBN to increase the total volume of sales. For the 355-day bill, the CBN allotted N402.85 billion, while for the 362-day bill, the total sold reached N993 billion, bringing the total amount sold in the February auction to N1.395 trillion as well as marking a significant increase compared to the January auction where only N1 trillion worth of bills were sold.
While the February auction had a strong showing, total subscriptions declined by 33.86 per cent compared to the previous month.
In January, the combined subscription for the two tenors was N2.895 trillion, significantly higher than the N1.915 trillion recorded in February. The demand for the 362-day bill saw the biggest drop, falling from N1.959 trillion in January to N1.499 trillion in February, representing a 23.46% decrease.
Despite lower investor demand in February, the CBN increased the amount it allotted. In January, the total successful bids amounted to N1 trillion, while in February, the figure rose by 39.50 per cent, reaching N1.395 trillion.
A movement in stop rates and the bid range for each tenor was also recorded. In the January 31, 2025, auction, the 347-day bill had a stop rate of 22.50 per cent, while the 361-day bill cleared at a slightly higher 22.65 per cent. In the February 13, 2025, auction, the 355-day bill had a stop rate of 21.3249 per cent, while the 362-day bill settled at 21.45 per cent, representing declines of 5.22 per cent and 5.31 per cent, respectively.
Similarly, the range of bids showed a downward trend. In January, the 347-day bill attracted bids ranging between 22.22 per cent and 23.38 per cent, while the 361-day bill saw bid rates from 22.25 per cent to 23.48 per cent. By February, the bid range narrowed, with the 355-day bill receiving bids between 20.40 per cent and 22.00 per cent, while the 362-day bill saw bids ranging from 20.45 per cent to 22.44 per cent.
