Nigeria's interbank
lending rate climbed to an average of 15 percent on Friday from 8.25 percent
last week as cash flowed out of the banking system to settle bonds and
treasury-bill purchases.
The central bank sold a total of 235.49 billion Nigerian
naira worth in both treasury bills and bonds this week, draining the system of
liquidity and pushed up the cost of borrowing among commercial lenders.
Traders said interbank rates initially rose to about 20 percent
because of tight liquidity, but fell when the central bank refunded 27.7
billion naira in excess amounts it had charged to enforce a cash reserve
requirement.
Nigerian banks are required to deposit 31 percent of their
customer's deposits with the central bank on zero interest as part of measures
to curb excess liquidity in the banking system.
Both the secured open buy back (OBB) and overnight placement
closed at 15 percent on Friday. OBB was 8 percent, compared with the benchmark
rate of 13 percent. Overnight placement was at 8.5 percent last week.
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