Nigeria’s central bank repaid a total of N340 billion worth of treasury bills on Thursday instead of rolling them over, in a move to lower government borrowing costs, traders said.
They included N131.4 billion worth of treasury bills issued by the Debt Management Office (DMO), while the balance was in open market bills issued by the central bank.
The DMO has said it will repay treasury bills maturing on Dec. 14 and Dec. 21 totalling N198.03 billion
Yields on treasuries held up across the board at around 10 percent on Thursday. They fell to 7 percent after the repayment plan was announced this week.
Thursday’s payoff increased banking system credit to almost N500 billion lowering overnight rates to one percent from five percent last week.
The DMO said it sold N108.66 billion worth of naira-denominated bonds maturing in 2021 and 2027 at an auction on Wednesday.
It issued N50 billion of 2021 debt at 13.19 percent, from 14.79 percent at the previous auction in November. The same tenor bond closed at 13.11 percent on the secondary market on Wednesday.
A total of N58.66 billion worth of the benchmark bond maturing in 2027 was issued at 13.21 percent, compared with 14.8 percent in November. The 2027 paper closed at 13.23 percent on the secondary market on Wednesday.