The Central Bank of Nigeria has cleared access to its Discount Window for FX and government debt dealers, marking the tenth major policy reform under Governor Olayemi Cardoso.
The directive, issued in an August circular, removes long-standing penalties that barred active market makers from emergency central bank liquidity.
Under the revised rules, financial institutions active in the Nigerian Foreign Exchange Market and primary Treasury Bill auctions can now access the Standing Lending Facility without restriction.
The regulator also lifted its suspension on Tenored Repurchase Operations, restoring collateralized borrowing across tenors ranging from four to 90 days to ease interbank funding pressure.
To broaden market participation, the central bank expanded Open Market Operations (OMO) primary and secondary auctions to non-bank financial institutions, corporate entities, and individual retail investors through commercial banks.
However, the CBN retained its strict prohibition against accessing the Discount Window and participating in OMO auctions on the same day to prevent systemic arbitrage and speculative borrowing.
This liquidity overhaul represents the tenth structural policy pillar deployed by the Cardoso administration since taking charge of the apex bank in September 2023.
It follows previous landmark initiatives, including FX market unification, clearing the $7 billion currency backlog, raising bank capital thresholds, and overhauling Bureau De Change operational guidelines.
Earlier reforms focused on orthodox inflation targeting, standardizing Cash Reserve Ratio debits, streamlining diaspora remittances, and enforcing anti-money laundering frameworks to exit international high-risk monitoring.
Financial analysts view this latest move as a transition from early emergency stabilization toward fine-tuning money market infrastructure and unfreezing commercial bank balance sheets.
By removing trading friction for FX dealers and primary debt bidders, the central bank aims to deepen liquidity and improve price discovery across local capital markets.
Simultaneously, opening OMO debt paper to retail and corporate investors allows the central bank to mop up excess systemic liquidity more effectively from non-bank pools.
The circular took immediate effect, applying to all Deposit Money Banks, authorized dealers, and institutional participants in Nigeria’s financial markets.
