By Boluwatife Oshadiya | August 18, 2026
Key Points
- Overnight funding rate falls 6 basis points to 22.19% as banks maintain strong liquidity positions
- Banks place ₦3.63 trillion with the CBN’s Standing Deposit Facility without accessing the lending window
- About ₦2.22 trillion NGOMOB maturity due on August 18 is expected to provide further liquidity support
Main Story
Money market funding rates eased at the start of the week as banks maintained a ₦3.57 trillion liquidity surplus ahead of an expected ₦2.22 trillion NGOMOB maturity inflow.
The Overnight Rate (OVN) declined by six basis points to 22.19%, while the Open Repo Rate (OPR) held at 22.00%, according to market data cited by AIICO Capital Limited.
Deposit Money Banks placed ₦3.63 trillion with the Central Bank of Nigeria’s (CBN) Standing Deposit Facility (SDF), with no borrowing from the Standing Lending Facility (SLF), indicating that banks had sufficient liquidity to meet immediate funding requirements.
AIICO Capital said the liquidity position should strengthen further following the maturity of approximately ₦2.22 trillion in NGOMOB securities on August 18. The inflow is expected to reduce short-term funding pressures and support easier money market conditions.
The movement follows a volatile liquidity pattern in the previous week. System liquidity opened at ₦4.08 trillion and climbed to ₦6.47 trillion by midweek, supported by an OMO maturity of ₦2.48 trillion, according to market data cited in the report.
The liquidity surplus subsequently fell to ₦3.57 trillion following a Nigerian Treasury Bills auction that allotted ₦1.46 trillion and an OMO auction that sold ₦2.60 trillion.
In the Treasury Bills secondary market, yields increased across all maturities. Yields on one-month, three-month, six-month and 12-month bills rose by 51 basis points, six basis points, three basis points and three basis points, respectively.
The average Nigerian Treasury Bills yield consequently increased by eight basis points to 18.62%, with thin trading volumes contributing to the predominantly bearish market tone.
the issues
The divergent movement between ample system liquidity and Treasury Bills yields highlights the influence of liquidity distribution and market positioning on short-term funding conditions. While banks have maintained substantial balances at the CBN’s SDF, increased demand for government securities and recent liquidity sterilisation have kept yields elevated.
what’s being said
AIICO Capital Limited expects the approximately ₦2.22 trillion NGOMOB maturity to improve system liquidity and moderate short-term funding pressures.
Coronation Merchant Bank’s research subsidiary attributed an additional net liquidity inflow of approximately ₦1.16 trillion to factors that may include SDF repayment timing and/or Federal Account Allocation Committee (FAAC) inflows.
what’s next
The key near-term development is the expected ₦2.22 trillion NGOMOB maturity on August 18, which should provide fresh liquidity to the financial system.
Market participants will also monitor Treasury Bills yields and overnight funding rates to assess whether the expected liquidity injection translates into sustained easing in funding conditions.
The Bottom Line:
The expected NGOMOB maturity should give banks additional liquidity and reduce immediate funding pressure. However, elevated Treasury Bills yields suggest that liquidity conditions alone may not be enough to reverse the market’s cautious positioning.
