Kate Roland
The Central Bank of Nigeria (CBN), acting on behalf of the Debt Management Office (DMO), is offering N700 billion through Nigerian Treasury Bills (NTBs) in the second and final scheduled auction for August 2026.
The offer covers the 91-day, 182-day and 364-day tenors, with the bulk of the issuance concentrated on the one-year bill as the apex bank continues to favour longer-dated securities amid strong investor demand.
According to the Invitation to Tender for Nigerian Treasury Bills obtained by Nairametrics, authorised Money Market Dealers are required to submit their bids through the CBN S4 Web Interface between 8:00 a.m. and 11:00 a.m. on Wednesday, August 26, 2026.
The auction will be conducted through the Dutch auction system, under which successful bidders are allotted securities at the respective accepted rates.
How the N700 Billion Offer Is Structured
The CBN has divided the N700 billion offer among the three maturities as follows:
- 91-day bill: N100 billion
- 182-day bill: N100 billion
- 364-day bill: N500 billion
- Total: N700 billion
The structure once again places significant emphasis on the 364-day instrument, which accounts for more than 70% of the total amount on offer.
Authorised Money Market Dealers can submit multiple bids either for their own accounts or on behalf of non-Money Market Dealers and interested members of the public.
Each bid must be submitted in multiples of N1,000, subject to a minimum bid amount of N50,001,000.
The auction result is expected to be released on Wednesday, August 26, while allotment letters are scheduled to be issued on Thursday, August 27.
Successful bidders are required to make payment to the CBN no later than 11:00 a.m. on the payment date. The apex bank also retains the discretion to reject bids or adjust the amount allotted depending on prevailing market conditions.
August NTB Market Has Already Seen Strong Demand
The latest auction comes after a particularly eventful start to August for the NTB market.
The CBN had initially scheduled an NTB auction for August 6, with N700 billion on offer across the same three tenors. However, the auction was withdrawn after the apex bank conducted back-to-back Open Market Operations (OMO) auctions on August 3 and 4, absorbing a combined N4.69 trillion from the banking system.
The cancellation fuelled market speculation that conducting another N700 billion NTB auction so soon after the massive OMO mop-up could place additional pressure on system liquidity.
The CBN subsequently returned to the primary market on August 12 with another N700 billion NTB offer.
That auction generated N4.4 trillion in total subscriptions, highlighting the continued appetite for government securities. The 364-day bill accounted for most of the demand, receiving N4.19 trillion in bids against the N500 billion offered—more than eight times the amount available.
CBN Raises 364-Day Stop Rate
Despite the strong demand, the CBN moved against the trend observed during the previous two auctions by increasing the stop rate on the 364-day bill.
The rate was raised by 24 basis points to 17.59%, from 17.35%, while N1.26 trillion was allotted on the tenor.
The shorter-dated bills maintained their previous rates, with the 91-day instrument clearing at 16.30% and the 182-day bill at 16.50%. The CBN allotted N148.57 billion and N47.48 billion on the two tenors respectively.
In total, approximately N1.456 trillion was allotted at the August 12 auction, more than double the advertised N700 billion offer.
With the first August auction cancelled, the August 12 sale therefore remains the only completed NTB auction for the month before the latest auction.
Rate Direction Remains a Key Focus
The increase in the 364-day stop rate represented a notable shift from the direction seen in July.
At the July 15 and July 29 NTB auctions, the CBN reduced the stop rate on the one-year bill despite strong demand. By the end of July, the rate had fallen to 17.35%.
The reversal on August 12 was particularly notable because the banking system was still experiencing substantial liquidity.
According to a Nairametrics report, the CBN repaid N2.48 trillion through OMO instruments on August 11 alone, contributing to a broader net liquidity injection of N5.21 trillion between August 4 and August 11.
The competing effects of strong demand for government securities and changing liquidity conditions will therefore be closely watched at Wednesday's auction.
What to Expect From the Latest Auction
The August 26 auction is part of the CBN's Q3 2026 NTB Issuance Programme, which targets gross issuance of N5.8 trillion between July and September.
August 12, August 26 and September 2 are among the six largest auction dates in the quarter, with each scheduled to feature N700 billion in offerings.
A major point of interest for investors will be whether the CBN continues to increase the 364-day stop rate or resumes the downward adjustment seen during July.
Market participants are also watching for signs of a potential shift in the broader interest-rate environment, with analysts expecting the CBN to begin cutting rates at its September Monetary Policy Committee meeting.
Beyond the headline N700 billion offer, the actual amount allotted could be significantly higher if the CBN maintains its recent practice of accepting bids above the advertised amount, particularly for the 364-day tenor.
If that pattern continues, Wednesday's auction could push the cumulative value of Treasury Bills allotted in August comfortably above N2 trillion, despite the cancellation of the month's first scheduled auction.