May 5, 2025/Coronation Report

Summary

• Last week, system liquidity still closed in the positive at N1.25tn (2^nd May ’25) from N1.78tn in the previous week, decreasing by 30.07% w/w. The Open Repo Rate (OPR) remained flat at 26.50%, while Overnight Rates (O/N) edged lower by 5bps to close at 26.83%.
• Average yields in the Nigerian Treasury Bills (NTB) edged higher by 25bps to close at 21.07% w/w. The short end of the curve increased by 69bps to close at 18.90%, the medium and long segments of the curve decreased by 1bps to close at 19.56%, and 22.90% respectively.
• In the secondary market for Open Market Operation (OMO), bullish sentiment was sustained across yields with average yields having decreased by 13bps closing at 27.00% w/w. The short segment’s yield decreased by 28bps closing at 27.72%. The medium and long segment’s yields also edged lower by 14bps closing at 27.30%, and 3bps closing at 26.62% w/w respectively.
• At the OMO auction last week, the 329-Day bills received muted interest. It attracted N133.25bn in subscriptions, representing over half of the N250bn offered, with the CBN allotting N106.25bn. The 350-Day bill witnessed more demand from investors, as they sought to lock in higher yields over a longer period. It recorded a subscription of N932.60bn representing more than three times the N250bn offered. Total subscription for the auction was N1.05tn with an oversubscription of N505bn. The Stop rates for the 329-Day tenor was 22.69%, while that of the 350-Day tenor was 22.73%.
• In the secondary market for Federal Government of Nigeria (FGN) bonds, the average yield increased by 2bps across the benchmark curve to close at 19.04% w/w. The short end of the curve witnessed a rise in yields, 8bps to close at 19.74%, the medium and long ends of the curve decreased by 3bps to close at 19.11% and 2bps to close at 17.43% respectively.
• At the Bond auction last week, the CBN offered N200bn for the Apr 2029 tenor, and N150bn for the May 2033 tenor. Total subscriptions for the tenors were N43.79bn and N452.16bn respectively, signalling an oversubscription of N145.95bn. A total of N397.89bn was allotted. The stop rates for both tenors were 19.00% and 19.99% respectively.
• Trading activity in the Eurobond market was bearish as average yields increased by 58bps to close at 10.63%.
• Bonny light lost 7.90% last week closing at US$63.75/bbl. This was mainly influenced by continued uncertainty over the ongoing tariff dispute.

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