Last week, the Nigerian Treasury Bills (“NT-Bills”) secondary market sustained its bearish run as investors remained on the sidelines due to the Primary Market Auction (“PMA”) slated for Wednesday (15-Jun-22) and as system liquidity remained tight at the start of the four-day trading week (₦16.6bn in the negative as at Tuesday). As a result, average NT-Bills advanced 53bps W-o-W to settle at 4.66% from 4.13% the previous week.

 The average yield across the curve advanced as short-, medium- and long tenor bills advanced 49bps, 21bps and 69bps W-o-W respectively on the back of sell-offs on the 25-Oct-22, 24-Nov-22 and 25-Aug-22 bills that expanded 106bps, 103bps and 101bps W-o-W respectively.

At Wednesday’s PMA, the Apex bank offered a total of ₦34.9bn worth of NT-Bills across the 91-, 182-, 364-Day instrument. The offer was oversubscribed as it recorded a total bid-to-cover ratio of 5.0x (₦178.45bn offer vs (₦34.8bn) subscription). In addition, the stop rates on all offers declined 1bps, 5bps and 37bps to close at 2.49%, 3.79% and 6.07% respectively.

 Please see a detailed summary of the NT-Bills PMA below: 

Going into the week, we expect demand to remain weak given the tight liquidity levels and that yields advance further in the absence of maturities to boost liquidity. Thus, we advise investors to position in relatively attractive bills and to remain alert for fundamentally sound corporate offers.

Please see indicative secondary market NT-Bills rates below: 

Rates are valid till 02:00 pm today (20-Jun-22)

*Please note that the minimum subscription for NT-Bills is ₦100,000.00
*Please note that rates quoted above are Net withholding tax (10%)

FGN Bonds Update: Bearish Run Persist as Average Yield Expands W-o-W to 11.19%
Last week at the FGN Bonds secondary market, performance turned bearish as investors reacted to the May 2022 Consumer Price Index (CPI) report (inflation inched higher by 17.7%) and as investors remained quiet ahead of the PMA slated for today. Consequent on this, average FGN Bonds yields inched northwards by 6bps W-o-W to 11.19% from 11.13% the previous week.
 
 In more detail, the short-dated bonds advanced the most by 25bps W-o-W as the 27-Apr-23 and 14-Mar-24 maturities expanded 97bps and 27bps W-o-W respectively.
 
Today, the Debt Management Office (“DMO”) is scheduled to offer N225.0bn across the MAR 2025, APR 2032 and JAN 2042 maturities.

Please see below details of the PMA offer: 

Going into the week, we expect the secondary market to remain quiet as the focus shifts to the PMA but do not rule out the possibility of demand channeled to the secondary market post-PMA. Thus, we maintain our advice that investors take advantage of maturities with relatively attractive yields across the curve.
 
Please see below FGN bonds secondary market rates: 

Rates are valid till 02:00pm today (20-Jun-22) 

*Please note that the minimum subscription for FGN Bonds is ₦20,000,000.00