By: ThinkBusiness Africa
The Federal Government’s ambitious plan to fund its 2026 fiscal deficit received a massive boost this week as the Central Bank of Nigeria (CBN) recorded a staggering N3.44 trillion in total subscriptions at its latest Treasury Bills (NT-Bills) auction.
According to CBN data, the auction, held on Wednesday, saw demand exceed the initial N1.15 trillion offer by nearly 300%. This “wall of cash” hitting the government securities market provides a critical cushion for the 2026 budget, which carries a projected deficit of N23.85 trillion.
With the Federal Government aiming to source 80% of its N17.89 trillion new borrowing from the domestic market this year, the success of these auctions is vital. The N3.44 trillion bid—the highest since December 2024—demonstrates that the market has the liquidity and the appetite to absorb the government’s debt requirements.
The overwhelming interest was concentrated in the 364-day tenor, which alone attracted N3.35 trillion in bids. By oversubscribing this long-term paper, investors have effectively signaled their willingness to bankroll the government’s long-term obligations, easing the immediate pressure on the Debt Management Office (DMO) to search for more expensive or volatile funding sources.
For the 91-day tenor, the Central Bank of Nigeria (CBN) offered N150 billion but received subscriptions of approximately N40.6 billion, all of which was allotted at a stop rate of 15.84%, a marginal increase from the previous 15.80%. The 182-day tenor saw an offer of N200 billion and a total subscription of N52.0 billion; of this, the CBN allotted N42.1 billion at a stop rate of 16.65%, up from 16.50%.
Collectively, the auction across all three tenors successfully drew in N3.44 trillion in bids, of which approximately N1.06 trillion was finally allotted to investors.
The auction coincided with the repayment of over N1.2 trillion in maturing Federal Government bonds and bills. The oversubscription signaled that Investors simply “rolled over” these funds into the new offer.
Meanwhile, The CBN’s orthodox monetary policy stance to curb inflation has kept interest rates at levels that appeal to both institutional fund managers and foreign portfolio investors (FPIs).
The DMO is expected to maintain this momentum as it executes its N7.55 trillion borrowing target for the first quarter of 2026.
