The Central Bank of Nigeria (CBN) on Thursday sold ₦4.1 trillion worth of instrument in the money market following the introduction of the 90-day special bills by CBN.
The instrument is expected to avail the monetary authority additional liquidity management tool, support the country’s economic recovery efforts and deepen the financial market.
The CBN has also announced a new capital requirement and licence categorisation for Payment Service Providers (PSP).
The sale of the 90-day special bills into the money market came just as CBN Governor, Mr. Godwin Emefiele, outlined the impact of the Anchor Borrowers’ Programme (ABP), set up to finance smallholder farmers.
He said the programme has revolutionised agricultural credit financing and remained the fulcrum of transformation initiatives in the sector.
Features of the special bills, introduced by the CBN, include zero-coupon, applicable yield at issuance to be determined by the CBN; the instrument will be tradable amongst banks, retail and institutional investors.
Also, the CBN stated that the instrument shall not be accepted for repurchase agreement transactions with the CBN and shall not be discountable at the CBN window.
In addition, the instrument will qualify as liquid assets in the computation of liquidity ratio for deposit money banks.
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Speaking on Arise Television on Thursday, the Head of Research at United Capital, Mr. Wale Olusi, who confirmed the development, said: “With this instrument, there is a new outlet for non-bank financial institutions who can go ahead and buy the bills from the banks.
“Technically, it is another form of Nigerian Treasury Bill or Open Market Operations (OMO). But regardless of what name they call it, as long as it is a zero-coupon instrument, it means that it is discounted at a particular rate, which is almost like treasury bills.”
In terms of pricing, the special bills are not different from OMO or treasury, Olusi said.
 on Thursday sold ₦4.1 trillion worth of instrument in the money market. This comes after the introduction of the 90-day special bills by CBN.){kind=link}