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DMO Revises Bond Auction Calendar, Issues New 15-year (2035s) and 50-year Bond (2050s) Maturities

FGN Bonds

Yields recovered slightly in the Bonds Market, buoyed by the revised Bond auction calendar from the Debt Management Office (DMO), as it replaced the 2029s and 2049s with new issuances (2035 and 2050) for the bond auction coming up later this month. This led to improved bids across the bond curve, especially on the replaced issuances (2029s and 2049s), but with very few offers, as market spread on the bid/offer tightened. Yields compressed by c.97bps across the benchmark bond curve.

We expect a quiet market with slight bearish trend resuming in tomorrow’s session, as no respite is in-sight for current global economic challenges.

Benchmark FGN Bonds
Description Bid (%) Offer (%) Day Change (%)
14.50 15-Jul-21 8.45 6.99 (3.53)
16.39 27-Jan-22 11.50 5.57 (1.17)
12.75 27-Apr-23 11.57 9.35 (0.77)
14.20 14-Mar-24 12.10 9.46 (0.71)
13.53 23-Mar-25 11.65 7.90 (1.19)
12.50 22-Jan-26 12.49 10.96 (1.01)
16.29 17-Mar-27 12.47 10.91 (0.50)
13.98 23-Feb-28 12.37 11.27 (0.58)
12.15 18-Jul-34 12.68 11.71 (0.31)
12.40 18-Mar-36 12.40 11.70 (0.59)
16.2499 18-Apr-37 12.64 11.60 (0.35)
14.80 26-Apr-49 13.00 12.81 (0.94)

Treasury Bills

The Treasury Bills market maintained its bearish course, as offers continued to improve across the OMO curve. The long-end of the curve constituted the main axes, with Foreign Portfolio Investors being the main drivers of the significant selling of OMO bills, as they traded above 16% levels towards the tail-end of the market. Yields expanded by an average of c.177bps across the benchmark OMO curve.

Similarly, the NTB side didn’t ease up in its bearish trend, as local investors continued to sell-off mostly at the short-end of the NTB curve. Yields expanded by c.17bps across the benchmark NTB curve.

With persistent supply from offshore investors, we expect to see more sell-off in OMO bills. We also anticipate a quiet session on the local side, as attention shifts to T-bills PMA scheduled tomorrow.

Primary Market Auction Expectation
NTB  – 11 Mar 2020  
Tenor Offer (N’bn) Expected Rate (%) Previous Rate (%)
91 days 1.80 3.00-3.50 3.00
182 days 14.00 3.50-4.00 4.00
364 days 70.50 5.00-6.00 5.70
Benchmark OMO Bills
Description Bid (%) Offer (%) Day Change (%)
NGOMO 19-Mar-20 17.00 12.00 2.00
NGOMO 2-Apr-20 17.00 14.00 2.00
NGOMO 14-May-20 17.00 15.25 2.00
NGOMO 4-Jun-20 16.25 14.75 1.25
NGOMO 2-Jul-20 16.50 12.25 1.50
NGOMO 13-Aug-20 17.00 13.00 2.00
NGOMO 3-Sep-20 17.00 12.35 2.00
NGOMO 1-Oct-20 17.00 12.25 1.80
NGOMO 3-Nov-20 17.00 13.00 1.70
NGOMO 1-Dec-20 17.00 13.00 1.70
NGOMO 5-Jan-21 17.00 15.25 1.70
NGOMO 02-Feb-21 16.85 13.00 1.55
Benchmark NTBills
Description Bid (%) Offer (%) Day Change (%)
NIGTB 2-Apr-20 9.50 1.00 0.50
NIGTB 2-Jul-20 9.50 1.00 0.50
NIGTB 1-Oct-20 9.00 1.00 0.00
NIGTB 12-Nov-20 9.00 1.00 0.00
NIGTB 14-Jan-21 9.00 3.50 0.00
NIGTB 11-Feb-21 9.00 1.00 0.00

Money Market

The Interbank rates dropped slightly, as banks had no significant funding requirements, causing rates to drop by c.180bps.  OBB and OVN rates closed at 13.80% and 14.40% respectively, with system liquidity opening with c.N244.24bn positive.

We expect rates to trade in tandem with tomorrow’s opening liquidity figures, as we anticipate rates to remain in double-digit figures.

Money Market Rates
  Current (%) Previous (%)
Open Buy Back (OBB) 13.80 15.50
Overnight (O/N) 14.40 16.42

FX Market

At the Interbank, the Naira/USD spot rate appreciated by 5k to close at N306.95/$, while the SMIS rate remained unchanged to close at N358.51/$. The Naira further depreciated at the I&E FX window, gaining 4k to close at N366.75/$.

At the parallel market, cash rate significantly depreciated by N4.20k to close at N363.00/$, while the transfer rate remained unchanged at N370.00/$.

FX Market
Current (N/$) Previous ( N/$)
CBN Spot 306.95 307.00
CBN SMIS 358.51 358.51
I&E FX Window 366.75 366.71
Cash Market 358.80 358.80
Transfer Market 370.00 370.00


The NGERIA Sovereign tickers maintained its bearish trend, with yields weakening across the sovereign yield curve, as investors continue to exit long positions in droves, largely due to depressed oil prices, which stands at $36.33 to the barrel.  Yields further spiked by c.50bps across the benchmark yield curve.

It was all bears in the NGERIA Corps tickers, as the effect of crashed oil prices was seen among most tracked papers. Yields on SEPLLN 2023s weakened the most by c.691bps D/D, while the ACCESS 2021s and FIDBAN 2022s retraced by c.288bps and c.175bps respectively.

Proshare Nigeria Pvt. Ltd.


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