By Boluwatife Oshadiya, 22nd April, 2026
Key Points
- System liquidity rises to ₦5.87 trillion on OMO maturities and CBN deposits
- Banks park ₦3.62 trillion at CBN standing deposit facility
- Funding costs tick up as overnight rate climbs to 22.29%
- Heavy OMO auction allotment of ₦1.92 trillion expected to drain liquidity
Main Story
Nigeria’s money market remained awash with liquidity on Tuesday, supported by strong inflows from matured Open Market Operations (OMO) bills and sustained placements by banks at the Central Bank of Nigeria (CBN) standing deposit facility.
Data from AIICO Capital Limited showed that financial system liquidity opened at a surplus of ₦5.87 trillion, marking a sharp increase from ₦3.57 trillion recorded in the previous session. The ₦2.31 trillion jump was largely driven by inflows from maturing OMO instruments and robust deposit activity by commercial banks.
Banks’ deposits at the CBN’s standing lending facility window stood at ₦3.62 trillion, reflecting continued preference for risk-free placements amid elevated interest rate conditions. Additional support came from ₦2.16 trillion worth of OMO maturities dated April 21, 2026, which injected fresh liquidity into the system.
However, the liquidity boost was partially offset by about ₦800 million in borrowings from smaller lenders through the CBN’s standing lending facility, indicating pockets of funding pressure within the banking system.
Despite the overall surplus liquidity, short-term funding rates edged higher, suggesting underlying tightness. Average funding cost rose marginally by 3 basis points to 22.15%. The Open Repo Rate (OPR) held steady at 22.00%, while the Overnight Rate (OVN) increased by 6 basis points to 22.29%.
During the trading session, the CBN conducted an OMO auction where it offered ₦600 billion. Demand significantly outpaced supply, with total subscriptions reaching ₦2.22 trillion, while allotments stood at ₦1.92 trillion. The sizeable sale is expected to moderate liquidity levels once settlement is completed.
Interbank rates reflected mixed movements across tenors. The overnight and six-month Nigerian Interbank Offered Rates (NIBOR) remained unchanged at 22.32% and 24.15%, respectively. Meanwhile, the one-month and three-month tenors rose slightly to 22.91% and 23.51%, indicating cautious liquidity conditions in the short-to-medium term segment.
In the Treasury bills secondary market, average yields increased by 2 basis points to 17.44%, reflecting mild sell pressure and cautious investor positioning ahead of new issuances.
What’s Being Said
Market analysts note that while liquidity remains elevated, aggressive OMO issuances by the CBN signal a deliberate effort to mop up excess funds and stabilise short-term interest rates. The marginal uptick in funding costs suggests that liquidity distribution across the banking system remains uneven.
What’s Next
Liquidity conditions are expected to tighten in the near term as the impact of the ₦1.92 trillion OMO allotment filters through the system. Analysts also anticipate cautious trading activity ahead of upcoming Treasury bills auctions, which could further influence yield direction and interbank rates.
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