A total of N6.305 billion has been raised so far in the past seven months from the Federal Government Savings Bond which debuted in March this year to encourage increased participation of low and middle income earners in the bond market.
There has been increased participation at the debt market as demand for Treasury Bills, FGN Bonds and the Savings Bond increased relative to supply.
A breakdown of the data sourced from the Debt Management Office showed that the initial auction of the Savings Bond still had the largest participation.
At the first auction in March, the debt office had raised N2.068 billion from the 13.01 per cent two year debt.
By the April auction, it offered a three-year debt with the yield on the two year paper lower than the previous auction.
It had raised N1.288 billion through the 12.794 per cent two-year paper and 13.794 three-year paper.
In May it raised N791.15 billion with yields rising to 13.189 per cent for the two year paper and 14.189 per cent for the three year paper.
The yield remained the same in June but the amount raised dropped to N607.26 million.
However an increased yield failed to spike interest in July as only N400.57 million was raised from the tow and three-year paper although the yield for the papers were raised to 13.386 and 14.836 per cents respectively.
By August, investors’ interest in the savings bond increased along with the yield offered.
The two-year bond was offered at 13.535 per cent while the three-year bond was offered at 14.535 per cent and the debt office was able to raise N738.14 million through the Savings Bond.
At the auction held this month, the DMO had raised N412.7 million from both the 13.817 per cent two-year paper and the 14.817 per cent three-year paper.
The DMO had made its first payment on the Savings Bond paying out N67.813 million.
Meanwhile activities in the Treasury bills market stayed soft last week on account of the weaker liquidity levels.
On Monday, average rate on benchmark tenors settled at 17.6 per cent, marginally down 1bp from the preceding Friday, as buy sentiment on shorter tenored instruments offset the impact of sell offs recorded across longer-dated bills.
On Wednesday, there had been a T-bills maturity of N140.9 billion which was rolled over at the primary market.
The CBN also offered N28.1 billion of the 91-Day, allotting N22.8 billion; N23.7 billion of the 182-Day allotting N24.7 billion and N89.1 billion of the 364-Day allotting N168.4 billion instruments at marginal rates of 13.2, 16.8 and 17.0 per cents respectively.
Due to lower stop rates at the T-bills PMA and excess subscription for longer-dated bills offered, sentiment was bullish on Thursday as average rate eased to 17.4 per cent but increased to 17.5 per centon Friday, down 0.2 per cent week on week.
This week, analysts say, they expect rates to remain at similar levels as an OMO maturity worth N123.5bn hits the system although even as CBN continues with its OMO mop up.
