The overnight interbank rate climbed sharply on Friday to an average of 8.5 percent, 4.5 percentage points higher than last week’s close on payment for bond purchases and on Assets Management Company of Nigeria (AMCON) contributions.
According to Reuters’ report monitored by Business247, Nigeria’s commercial lenders in 2010 agreed to make available 0.3 percent of their assets each year for the next decade to a fund to cover any net deficits incurred by (AMCON).
Traders said the Central Bank of Nigeria (CBN) withdrew about 90 billion naira ($452.26 million) from the banking system on Friday for the Nigeria’s “bad bank” liability, which led to a drop in banking system liquidity and a spike in interbank rate.
Also, about 52.5 billion naira left the banking system to pay for bonds purchased in the week, which further depleted liquidity in the system, traders said.
Nigeria raised 52.5 billion naira in local currency denominated bonds where yields climbed across the board on paper maturing in 2036, 2026 and 2020 at an auction on Wednesday.
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