Nigeria’s Central Bank of Nigeria (CBN) absorbed a total of N4.48 trillion from the banking system within two sessions in six days through aggressive Open Market Operations (OMO), leaving opening balances of banks and discount houses down in mid-April.
CBN’s financial system data between April 8 and April 15, 2026, shows that the apex bank intensified efforts to sterilise excess funds, particularly on April 9 and April 14.
Consequently, banks’ opening balances, which rose steadily earlier in the period, dropped sharply to N99.05 billion on April 15 from N135.76 billion the previous day.
Despite this moderation, substantial cash was parked in the Standing Deposit Facility (SDF), highlighting a persistent liquidity overhang even as the CBN stepped up its mop-up operations.
What the data is saying
The data reveals a system flush with liquidity but increasingly managed through targeted interventions by the apex bank:
- Total OMO sales hit N4.48 trillion across two sessions:
- N2.31 trillion on April 9
- N2.17 trillion on April 14
- Standing Deposit Facility (SDF) declined steadily to N3.69 trillion (April 15) from N6.98 trillion (April 8)
- Opening balances fell sharply to N99.05bn (April 15) from N179.31bn (April 10)
- OMO repayment: N1.34 trillion recorded on April 14
- Primary market sales: N731.38 billion on April 9
- Primary market repayment: N357.89 billion repayment same day
The pattern of liquidity flows suggests a deliberate and targeted strategy by the CBN to rein in excess cash without disrupting market stability.
More insights:
The data underscores a deliberate liquidity management strategy by the CBN aimed at controlling excess cash in the system.
- The large OMO sales on April 9 and April 14 suggest targeted interventions to absorb surplus liquidity and stabilise money market rates.
- The sharp drop in SDF balances—from nearly N7 trillion to N3.69 trillion—indicates that while banks still held excess liquidity, a portion of these funds was successfully sterilised through market operations.
- This aligns with broader monetary policy objectives of curbing inflationary pressures and maintaining exchange rate stability.
- The financial system remained comfortably liquid, with institutions opting to park funds with the CBN rather than deploy them aggressively.
There seems to be persistently high liquidity as SDF levels show that liquidity conditions remain comfortable, with lenders preferring to park funds safely with the apex bank rather than expand risk exposure aggressively.
What you should know:
The latest aggressive liquidity mop re-enacts the scenario of March 23 to 27, when the CBN sterilized a whopping N4.11 trillion in dual sessions of OMO sales.
- OMO auctions and the standing deposit facility are part of the tools CBN deploys for liquidity management to rein in excess cash and stabilise short-term interest rates.
- Such interventions are intended to tame inflationary pressure and keep the exchange rate stable. Similar liquidity mop-up actions were undertaken by CBN earlier in the month.
- While liquidity remains robust, the downward trend in opening balances and SDF deposits signals a gradual tightening.
- This could influence interbank rates, lending behaviour, and overall financial market dynamics in the weeks ahead.
The data points to a financial system increasingly shaped by deliberate and sustained policy actions from the apex bank to support macroeconomic stability.
