Subscriptions hit N2.41 trillion as market preference for 364-day papers drives oversubscription and sustained high yields…..
The Central Bank of Nigeria (CBN) has allotted a total of N731.75 billion at its Treasury Bills Primary Market Auction held on Wednesday, May 6, 2026, as investors continued to show strong appetite for longer-dated government securities despite a slight easing in yields across all maturities.
Data from the auction showed that total subscriptions surged to N2.41 trillion, far above the N700 billion offered across the 91-day, 182-day, and 364-day instruments, underscoring sustained liquidity in the financial system and heightened demand for risk-free assets.
The results also revealed that the apex bank increased its allotment above the initial offer size, particularly for the one-year (364-day) bill, as it responded to overwhelming demand from investors seeking to lock in relatively high returns.
Long-term bills dominate investor demand
Investor interest was heavily skewed toward the 364-day tenor, which attracted the bulk of subscriptions at N2.23 trillion against an offer of N550 billion. The CBN ultimately allotted N600.49 billion on the instrument.
The 182-day bill recorded moderate demand, with subscriptions of N105.33 billion compared to an offer of N50 billion, while the 91-day paper saw comparatively weaker interest, attracting N71.23 billion against N100 billion offered. It was eventually allotted N63.58 billion.
Market analysts say the trend reflects a clear preference for locking in longer-term yields amid uncertainty in Nigeria’s broader macroeconomic environment.
Yields ease slightly but remain attractive
Stop rates across all tenors declined marginally, even as demand remained strong.
- The 91-day bill eased slightly to 15.949%, from 15.95% previously
- The 182-day bill declined to 16.14%, from 16.19%
- The 364-day bill fell to 16.15%, from 16.20%
Despite the mild decline, implied yields remained elevated. The 91-day instrument delivered an estimated true yield of 16.62%, while the 182-day and 364-day bills offered about 17.57% and 19.26%, respectively.
The relatively muted demand for the short-term 91-day bill further highlights investors’ preference for longer-duration securities, where returns remain more attractive.
Sustained liquidity fuels repeated oversubscription
The latest auction continues a pattern seen in recent months, where demand for Treasury bills has consistently outstripped supply.
In April 2026, the CBN conducted two major auctions worth N700 billion and N750 billion, but total allotments rose to about N1.63 trillion due to strong investor appetite. At one of those auctions alone, subscriptions reached N2.36 trillion, again driven largely by demand for the 364-day instrument.
Analysts say the sustained oversubscription reflects abundant system liquidity and investor efforts to secure high-yield, low-risk instruments amid expectations that interest rates may gradually ease in the coming months.
For now, however, Nigeria’s short-term debt market continues to attract heavy participation, with investors showing little appetite for the lower yields typically associated with shorter tenors.
