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The Central Bank of Nigeria (CBN), acting on behalf of the Debt Management Office (DMO), is set to offer N700 billion in Nigerian Treasury Bills (NTBs) at an auction scheduled for September 3, as the authorities move into the final phase of the third-quarter borrowing programme.
The planned sale will cover three maturities 91-day, 182-day and 364-day bills with the longest tenor accounting for the bulk of the offer.
According to the auction notice, the CBN will offer N100 billion each in 91-day and 182-day bills, while N500 billion will be available in the 364-day tenor, bringing the total offer to N700 billion.
Dealers to Submit Bids Ahead of Auction
Money market dealers are expected to submit their bids through the CBN’s S4 Web Interface between 8:00 a.m. and 11:00 a.m. on Wednesday, September 2.
Each bid must be submitted in multiples of N1,000, subject to a minimum amount of N50.001 million. Dealers may also submit multiple bids either for themselves or on behalf of eligible non-money-market dealers and members of the public.
The apex bank retains the authority to reject bids or adjust the amount ultimately allotted depending on prevailing market conditions.
The auction results are expected on September 2, with allotment letters scheduled for September 3. Successful bidders are required to make payment to the CBN by 11:00 a.m. on September 3.
N5.8trn NTB Programme Underway
The September offer forms part of the government’s broader N5.8 trillion Treasury Bills issuance programme for the third quarter of 2026.
Under the programme, N900 billion is allocated to 91-day bills, another N900 billion to 182-day instruments and N4 trillion to 364-day bills.
The one-year tenor therefore accounts for roughly 69% of the planned quarterly issuance, making it the dominant instrument in the programme.
Meanwhile, Treasury Bills worth approximately N2.644 trillion are scheduled to mature during the quarter, leaving an estimated N3.16 trillion in net new borrowing after maturities are repaid.
The September 3 auction is among the final sales scheduled under the Q3 programme.
CBN Has Been Absorbing Significant Liquidity
The latest auction comes after the CBN significantly increased its intervention in the fixed-income market during August.
An earlier N700 billion auction scheduled for August 5 was cancelled following back-to-back Open Market Operations (OMO) sales that had already removed substantial liquidity from the financial system.
The market also experienced liquidity releases when N378.43 billion in Treasury Bills matured on July 22 without a corresponding new issuance, followed by another N429.23 billion maturity on August 19.
The CBN subsequently returned to the market through fresh Treasury Bill auctions to absorb some of the liquidity released by those maturities.
Investors Continue to Show Strong Demand
Demand for short-term government securities has remained significantly above the amounts advertised by the CBN.
At the August 12 auction, investors submitted bids worth N4.4 trillion against N700 billion on offer.
The 364-day instrument accounted for N4.19 trillion of the bids, while its stop rate increased by 24 basis points to 17.59%.
At the August 26 auction, however, the CBN reduced the one-year stop rate by 44 basis points to 17.15%, following the earlier increase.
Across the August 12 and August 26 auctions, the CBN allotted a combined N2.218 trillion, significantly above the N1.4 trillion that had initially been advertised for the two sales.
September Auction Could Offer Policy Signal
The September auction is attracting additional attention because of expectations surrounding the next Monetary Policy Committee (MPC) meeting.
Market analysts widely expect the CBN to consider reducing interest rates at its September meeting. Against that backdrop, the Treasury Bill auction could provide an early indication of whether the apex bank is beginning to accommodate lower rates or remains focused on absorbing excess liquidity.
The CBN’s recent approach has involved substantial allotments, particularly at the one-year tenor, as authorities balance liquidity management with borrowing costs.
Analysts have also raised concerns about the economic cost of maintaining elevated interest rates to attract foreign portfolio inflows.
At the same time, other market observers argue that the Treasury Bill programme forms part of a broader effort to manage money supply, inflation and exchange-rate stability.
Market Watches CBN’s Next Move
With the Q3 NTB programme approaching its conclusion, the September 3 auction will be closely monitored for both the level of investor demand and the rates accepted by the CBN.
The outcome could provide clues about the direction of short-term interest rates ahead of the September MPC meeting, particularly after the reduction in the one-year stop rate at the August 26 auction.
For investors, the key indicators will be the volume of bids received, the amount ultimately allotted and the stop rates across the three tenors.
For the CBN, the auction represents another opportunity to manage liquidity while progressing with the N5.8 trillion Q3 Treasury Bill programme as the third quarter draws to a close.
