CBN Allocates ₦8.14tn Through Treasury Bills, Beats Q3 Target by ₦2.34tn
The Central Bank of Nigeria (CBN) allocated about ₦8.14 trillion through Treasury Bills (T-Bills) auctions in the third quarter of 2026, significantly exceeding the government’s planned issuance for the period.
The amount was about ₦2.34 trillion higher than the ₦5.8 trillion target set for the quarter by the Debt Management Office (DMO), representing an increase of approximately 40.34 per cent.
The figures were derived from a review of eight Nigerian Treasury Bills auctions conducted between July and September.
One-year bills dominate borrowing
The 364-day Treasury Bill accounted for the overwhelming majority of the funds allocated during the quarter.
About ₦7.09 trillion, representing roughly 87 per cent of total allotments, went into the one-year instrument.
Strong investor demand for the longer-dated bill contributed significantly to the CBN’s ability to allocate amounts above the advertised offers during several of the auctions.
Yields climbed before declining
The heavy demand for government securities occurred during a period when Treasury Bill yields remained relatively attractive.
The stop rate on the 364-day bill reached a quarterly high of 17.70 per cent on July 8. It remained elevated through much of July and August as investors continued to show strong interest in the securities.
However, yields began falling in September as monetary conditions changed.
At the September 23 auction, the stop rate for the 364-day bill had dropped to 15.89 per cent, representing a decline of 181 basis points from the quarter’s peak.
September signals shift in borrowing conditions
The final auction reviewed showed a notable change from the pattern seen earlier in the quarter.
On September 23, the CBN allotted approximately ₦497.59 billion, an amount below the ₦750 billion offered.
This followed the CBN’s 350-basis-point reduction in the Monetary Policy Rate (MPR), signalling a shift toward lower interest rates in the financial system.
Treasury Bills remain important financing tool
The DMO’s third-quarter issuance programme had targeted ₦5.8 trillion in gross Treasury Bill issuance.
The programme consisted of ₦900 billion in 91-day bills, ₦900 billion in 182-day bills and ₦4 trillion in 364-day bills, with the one-year instrument accounting for the largest planned share.
The amount actually allotted during the reviewed auctions therefore significantly exceeded the original programme.
The DMO had also projected approximately ₦2.64 trillion in Treasury Bill maturities during the quarter, meaning part of the funds raised would effectively replace maturing obligations.
Investor demand remains a key factor
The strong uptake of Treasury Bills indicates continued investor appetite for government-backed securities, particularly when yields are relatively attractive.
However, the decline in yields toward the end of the quarter suggests that market conditions are changing as monetary policy becomes less restrictive.
With the Q3 issuance target already exceeded, attention is now turning to the CBN and DMO’s approach to Treasury Bill issuance in the fourth quarter.
The direction of interest rates, liquidity conditions and investor demand will likely influence how much the government seeks to raise through short-term domestic securities going forward.
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