CBN explains N25.4b interbank transactions in six months

• Published date: 10 January 2023
• Publication title: Nigeria - The Nation

The Central Bank of Nigeria (CBN) has said a total value of transactions at the inter-bank funds market stood at N25.4 trillion in the first six months of this year.

In the apex bank's half-year activity report, it said the interbank deals represent a decrease of N667.81 billion and 2.63 per cent from N26.07 trillion in same period of 2021.

Analysis of the transactions indicated that open-buy-back (OBB) stood at N25.2 trillion, accounting for 99.41 per cent, while the unsecured inter-bank call took up 0.59 per cent or N150.52 billion.

In the corresponding period of 2021, OBB accounted for N25.86 trillion or 99.18 per cent, while the unsecured segment recorded N214.40 billion or 0.82 per cent.

The sustained recourse to the OBB segment in the review period was attributable to risk aversion by counter-parties, as there was low appetite for unsecured lending in the market.

The report, signed by Deputy Governor, Economic Policy, Dr. Kingsley Obiora, said money market rates movements was influenced by liquidity conditions in the banking system.

The contributory factors included the fiscal operations of government; effects of Cash Reserve Ratio operations; deposits and settlement for foreign exchange intervention, as well as the sale and maturities of CBN and government securities.

'Consequently, the weighted monthly average inter-bank call rates ranged...