INTERBANK lending rates remained unchanged last week despite the recall of about N45 billion($303.54 million) by the Nigerian National Petroleum Corporation (NNPC) from some retail banks, traders said.  The oil firm sells foreign exchange to banks every month and transfers the naira equivalent to its account with the Central Bank of Nigeria as part of money supply controls in sub-Saharan Africa’s second biggest economy.
The secured Open Buy Back (OBB) was unchanged at 1.0 percent, 10 basis points above the central bank’s Standing Deposit Facility (SDF) rate, but well below the bank’s 6.0 percent benchmark interest rate.
Overnight placement closed flat at 1.20 percent, while call money was a notch higher at 2.0 percent.
“Nothing significant happened in the market during the week, apart from the NNPC funding by some banks and sales of about 20 billion naira in secondary treasury bills,” one dealer said. Traders said the cash withdrawal by the oil firm did not impact on the cost of borrowing in the market because the system remains largely liquid.
“Market closed on Friday with about 508.58 billion naira balance, which shows that the system remains significantly liquid,” another dealer said.  Dealers said the liquidity from previous week’s disbursement of about $1 billion from the oil windfall savings account to the three tiers of government remained in the system and with no major debit hitting the system.