Weekly Update on NT-Bills [20.51% down 19bps] and FGN Bond [18.60%]

Weekly Update on NT-Bills [20.51% down 19bps] and FGN Bond [18.60%]
(Source: Afrinvest Securities Limited, Date: 28-Apr-2025)

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Bulls Prevails as Average Yield Declines By 19bps W-o-W to 20.51%

The NTB secondary market traded with a bullish bias last week, supported by robust system liquidity, which stood at ₦950.52bn as at Wednesday, 23-Apr-25. Improved demand was recorded across the curve, leading to a general decline in yields. Consequently, the average benchmark yield declined by 19bps w-o-w to settle at 20.51%.

In more detail, bullish sentiment was more pronounced at the short- to mid-end of the curve, with notable interest seen on maturities like the 09-Oct-25 and 06-Nov-25 papers. Meanwhile, the newly issued 1-year NTB was actively traded, settling around 19.45%, about 15bps lower than its auction stop rate of 19.60%. Overall, yield movements across the curve reflected strong liquidity-driven demand throughout the week.

At the NTB Primary Market Auction (PMA) held on 23-Apr-2025, the Debt Management Office (DMO) offered a total of ₦400.00bn across the 91-day, 182-day, and 364-day tenors. Demand was robust, particularly on the 364-day paper, driving total subscription to ₦1.54tn. Stop rates cleared at 18.00%, 18.50%, and 19.60% on the 91-day, 182-day, and 364-day bills respectively, reflecting slight upward adjustments relative to previous auction levels.

Please see a detailed summary of the NT-Bills PMA below:

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This week, we anticipate market sentiment to be influenced by the anticipated liquidity levels. Thus, we advise investors to look out for relatively attractive bills across the curve, as well, as possible commercial paper offerings.

Please see indicative secondary market NT-Bills rates below:

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Rates are valid till 2:00pm today (28-Apr-25)

*Please note that the minimum subscription for NT-Bills is N100, 000.00

FGN Bond Market: Average Yield Holds Steady W-o-W at 18.60%

The FGN bonds secondary market traded on a mixed-to-bullish note last week. The market opened on a cautious tone amid mid-tenor sell pressure but witnessed renewed demand midweek following the release of the Q2 bond auction calendar and the April issuance circular. Consequently, buying interest strengthened across the mid- to long-end of the curve. As a result, the average benchmark yield held steady W-o-W at 18.60%.

In detail, activity at the short end was relatively muted. Meanwhile, the mid-tenor segment saw strong demand, particularly on the FGN 2031 and FGN 2033 papers, where yields compressed by about 45bps and 25bps, respectively. On the long end, buying interest in the FGN 2053 bond helped sustain the bullish momentum, although movements were less pronounced compared to the mid-segment.

Today, Monday 28-Apr-25, at the Primary Market Auction (PMA) the Debt Management office (...DMO" ) will be offering a total of N150.00bn to N200.00bn across the APR-2029 and MAY-2033, maturities.

Please see below our PMA expectations:

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Going into the week, we anticipate a calm start in the coming week as investors focus is driven towards the FGN Bonds PMA scheduled this week. We therefore advice investors to take advantage of maturities with relatively attractive offers in the secondary market particularly at the short end of the curve

Please see below FGN bond secondary market rates: