CBN targets N900bn from Treasury bills amid falling yields

The Central Bank of Nigeria (CBN), on behalf of the Debt Management Office (DMO), will offer N900 billion in Nigerian Treasury Bills (NTBs) at Wednesday’s auction, as the yield on the one-year instrument continues to decline.

The 364-day bill accounts for N700 billion, or 77.8 per cent of the total offer, while N100 billion each will be offered through the 91-day and 182-day bills.

The auction, scheduled for October 7, 2026, is the first NTB sale of the fourth quarter, with settlement set for Thursday, October 8.

The latest offer comes as the stop rate on the one-year Treasury bill has fallen to 15.89 per cent following a sustained decline in NTB yields and the Central Bank’s 350-basis-point reduction in the Monetary Policy Rate to 23 per cent.

The auction notice did not state the stop rates, bid limits or submission deadline, meaning the final pricing will be determined by demand during the auction.

Demand for longer-dated Treasury bills remained strong at the previous auction on September 23, when subscriptions across the three tenors reached N4.23 trillion.

The 364-day bill accounted for about N4.09 trillion, representing roughly 97 per cent of total subscriptions, while the DMO allotted N497.59 billion across the three instruments.

The one-year stop rate declined by 73 basis points at the September 23 auction to 15.89 per cent. Stop rates for the 91-day and 182-day bills also fell to 15.50 per cent and 15.80 per cent respectively.

The 364-day stop rate has now declined by 146 basis points across four consecutive auctions, from 16.84 per cent on September 2.

It is also 181 basis points below the third-quarter peak of 17.70 per cent recorded on July 8.

The strong demand for longer-dated instruments comes as the DMO continues to rely heavily on Treasury bills to raise short-term government funding.

In the third quarter, the DMO allotted about N8.14 trillion through eight NTB auctions, exceeding its N5.8 trillion target by 40.34 per cent.

The DMO is expected to release its indicative NTB issuance calendar for the fourth quarter, outlining planned offers, maturities, auction dates and settlement dates.