May Report Shows That DMO Traded Treasury Bills for N324.43 Billion

In May 2023, the Debt Management Office (DMO) reports show that Treasury Bills (T.bills) were traded for N324.43 billion.

According to the analysis of the FMDQ Markets Monthly Report for May, the amount marks a 15.41% (N43.33 billion) Month on Month (MoM) increase over the value of T-bills sold across its auctions in April 2023 (N281.10 billion).

According to the report, the DMO reopened two (2) 10Y, one (1) 20Y, and one (1) 30Y FGN Bonds totaling N545.26 billion in May 2023.

The entire sale reflected a 151.46% oversubscription of the amount offered and a 1.30% (N7.21 billion) MoM drop from the amount sold in April 2023 for the same FGN Bond maturities (N552.26 billion).

Report on Corporate Bonds

According to the report, the total value of corporate bonds listed on the FMDQ Exchange in May 2023 was N31.00 billion, up from N0.00 billion the previous month.

• In the review month, the corporate bond listings emanated from issuers in the Financial Services and Oil & Gas sectors, respectively. 

• As a result, the total outstanding value for corporate bonds increased MoM by 1.71% (N27.50 billion) from N1,609.49 billion in April 2023 to N1,636.99 billion in May 2023,” it noted. 

Report on Commercial Papers

According to the report, the total value of Commercial Papers (CPs) quoted on the FMDQ Exchange in May 2023 was N163.77 billion, a 43.32% (N49.50 billion) increase over the value of CPs quoted in April 2023.

• “Quoted CPs were issued by institutions from various sectors including Financial Services (17), Agriculture (4), Real Estate (3), Health and Pharmaceuticals (3), Retail (2), Manufacturing (2), and Consumer Staples (1). 

• As a result, the total outstanding value of CPs increased MoM by 10.23% from N73.15 billion to N788.43 billion,” it said.

Report on Secondary Market Turnover

The report stated that secondary market turnover on the FMDQ Exchange in May 2023 was N15.78 trillion, representing an MoM and YoY increase of 25.67% (3.22 trillion) and 2.53% (N0.39 trillion), respectively, from April 2023 and May 2022 figures. It also stated that foreign exchange (FX), money market (MM), and CBN Bills transactions dominated secondary market activity in May 2023, accounting for 80.25% of total secondary market turnover.

• Total spot market turnover for all products traded in the secondary market was N13.37 trillion in May 2023, representing an MoM increase of 26.21% (N2.78 trillion) from April 2023 figures. 

• The MoM increase in total spot market turnover was jointly driven by an improvement in turnover across all products with FX, FI, and MM transactions increasing MoM by 31.74% (N0.69 trillion), 25.97% (N1.31 trillion) and 22.98% (N0.77 trillion), respectively. 

• The increase in MM turnover was driven by an uptick in Repos/Buy-backs and Unsecured Placement/Takings transactions. Likewise, the improvement in FI turnover was driven by an MoM increase across all FI products in the review period,” the report noted.

According to the report, the Spot FX market turnover was N2.88 trillion ($6.21 billion) in May 2023, reflecting a MoM increase of 31.74% (N0.69 trillion) over the turnover reported in April 2023 (N2.18 trillion).

"In the foreign exchange market, the Naira depreciated against the US dollar, with the spot exchange rate ($/) increasing by 0.07% ($/N0.31) to close at an average of $/N463.39 in May 2023, up from $/N463.09 in April 2023."

The Naira traded within an exchange rate range of $/N462.23 - $/N465.13 in May 2023, up from $/N462.00 - $/N464.00 in April 2023," it said.

Report on Fixed Income

According to the report, the Fixed Income (FI) market turnover was N6.36 trillion in May 2023, showing an MoM rise of 25.97% (N1.31 trillion) over the turnover reported in April 2023 (N5.05 trillion).

• “The MoM increase in the FI market turnover was jointly driven by an uptick in turnover across all FI products with T.Bills, OMO Bills, CBN Special Bills, FGN Bonds and Other Bonds improving by 15.66% (N0.18 trillion), 18.30% (N0.28 trillion), 49.45% (N0.47 trillion), 27.05% (N0.37 trillion) and 86.43% (N0.005 trillion) respectively.

•  As a result, the trading intensity (TI) for T.Bills, OMO1 Bills, and FGN Bonds increased MoM by 0.04, 10.99, and 0.02 points to 0.29, 21.68, and 0.10 respectively,” the report said.