LAGOS: Nigerian interbank lending rates held steady at an average of 10.5 percent on Friday, the same as last week, after the central bank retired about 226 billion naira ($1.41 billion) in matured treasury bills, boosting liquidity level in the banking system.
Lending rates on the interbank had rose to an average of 14 percent on Wednesday after the central bank recalled about 230 billion naira from the banking system to meet a new cash reserves requirement (CRR) on private sector deposits.
"The withdrawal of CRR on Wednesday had pushed up rates, but with the repayment of matured treasury bills on Thursday by the central bank, rates reverted back to the initial level," one dealer said.
The cash balance that lenders hold at the central bank opened at 386.89 billion naira surplus, down from 494 billion naira last week. Last month, the central bank hiked CRR on private sector deposits by 300 basis points to 15 percent to further tighten liquidity and curb speculation on the local currency.
The secured Open Buy Back was unchanged for the third consecutive week at 10.25 percent, 1.75 percentage points below the central bank's benchmark rate of 12 percent.
The overnight placement and call money were also unchanged at 10.5 percent and 10.75 percent, respectively.
Traders said rates should remain stable at the prevailing level next week in anticipation of further injection of funds from budgetary allocations to government agencies.
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