Nigeria’s banking system recorded a significant cash surge in November, with total inflows reaching N5.11 trillion, driven by a combination of large Treasury redemptions, OMO maturities and government disbursements.
The wave of cash eased funding pressures across the financial system, sending interbank rates sharply lower and boosting demand for fixed-income instruments.
Specifically, the month under review saw N1.35 trillion in Nigerian Treasury Bill (NTB) maturities and N1.76 trillion in Open Market Operation (OMO) maturities, providing an immediate liquidity boost to banks.
Additional support came from the N2 trillion FAAC allocation, which filtered into the system as government spending picked up. Market traders said the combined inflows left the system “comfortably funded,” with many banks carrying surplus positions through most of the month.
The strong liquidity backdrop pushed down short-term borrowing costs. The Overnight Nigerian Interbank Offered Rate (O/N NIBOR) fell 814 basis points month-on-month to 22.86 per cent, while the 1-month, 3-month, and 6-month rates also declined moderately, reflecting reduced demand for overnight borrowing as banks held large idle balances.
