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The Debt Management Office (DMO) allotted N968.47 billion in Nigerian Treasury Bills (NTBs) on Wednesday, exceeding its N900 billion offer as strong investor demand accompanied a further decline in the 364-day stop rate to 15.85%.
The October 7, 2026 auction results show that the DMO, through the Central Bank of Nigeria (CBN), received approximately N1.77 trillion in total subscriptions across the three tenors, representing about 2.0 times the amount offered.
Demand was overwhelmingly concentrated in the one-year instrument, where investors submitted N1.683 trillion for N700 billion offered, allowing the DMO to allot N885 billion while the stop rate declined four basis points from 15.89%.
364-Day Bill Draws N1.68 trillion:
The 364-day instrument attracted approximately 95.1% of total subscriptions and accounted for about 91.4% of the amount eventually allotted. The DMO sold N885 billion of the one-year bill, N185 billion or 26.4% above the N700 billion initially offered.
- The strong demand coincided with a further decline in the one-year stop rate, extending the downward movement recorded at recent auctions.
- Investors submitted N1.683 trillion for the 364-day bill, equivalent to about 2.4 times the N700 billion offered.
- The stop rate declined four basis points to 15.85% from 15.89% at the previous auction.
- Nairametrics previously reported that the one-year stop rate had fallen 146 basis points across four consecutive auctions from 16.84% on September 2.
The latest 15.85% stop rate is 185 basis points below the 17.70% third-quarter peak recorded on July 8.
The DMO was therefore able to increase the one-year allotment substantially above its advertised amount without raising the stop rate.
Shorter Treasury Bills stay undersubscribed:
Demand for the one-year bill contrasted sharply with weak subscriptions for the shorter instruments. The DMO offered N100 billion each in 91-day and 182-day bills, but neither tenor attracted subscriptions equal to half of its offer.
- The yield curve was also compressed, with only 35 basis points separating the 91-day and 364-day stop rates.
- The 91-day bill attracted N39.42 billion against N100 billion offered, with N38.55 billion eventually allotted at an unchanged stop rate of 15.50%.
- The 182-day bill received N46.87 billion in subscriptions against N100 billion offered, while N44.92 billion was allotted at an unchanged 15.80%.
- Combined subscriptions for both shorter instruments were N86.29 billion against N200 billion offered, compared with N1.683 trillion submitted for the 364-day bill.
- The 364-day stop rate of 15.85% was only five basis points above the 182-day rate and 35 basis points above the 91-day rate.
Despite the narrow stop-rate differentials, demand for the one-year bill was about 19.5 times the combined subscriptions received for the two shorter tenors, confirming a strong preference for the longest maturity at the auction.
CBN sterilisation shapes liquidity outlook:
The auction took place against a backdrop of substantial liquidity management by the CBN. A day earlier, the apex bank withdrew N3.31 trillion through an OMO auction while approximately N2.17 trillion in maturing OMO bills returned to the banking system, resulting in a net withdrawal of about N1.14 trillion.
- That followed another month of aggressive OMO activity in September, when the CBN sold about N17.51 trillion while approximately N10.89 trillion matured.
- September OMO activity produced a net liquidity withdrawal of approximately N6.62 trillion across five auctions.
- The Financial Markets Dealers Association projects N13.25 trillion in financial-system liquidity inflows for October, 14.82% below the N15.56 trillion projected for September.
- OMO maturities are expected to contribute N9.05 trillion, or about 68.3%, of projected October inflows.
At the October 7 NTB auction, the DMO ultimately raised N68.47 billion, or 7.6%, more than its N900 billion advertised offer.
The latest auction shows that substantial demand remains available for one-year government securities despite lower rates and continued CBN liquidity withdrawals, while the 91-day and 182-day bills remain considerably less sought after.
