Nigeria’s Treasury Bills market experienced a significant surge in investor demand during its latest primary auction.

Total subscriptions reached N4.59 trillion, which was nearly three times the N1.15 trillion offered by the Debt Management Office.

The auction took place on Wednesday, February 4, 2026.

Despite the overwhelming inflows, the DMO adopted a cautious stance by allotting only N952.60 billion across the three tenors: 91-day, 182-day, and 364-day bills.

Investors showed a clear preference for longer-dated instruments, especially the 364-day bill. This preference indicates strong confidence in government securities as a safe and attractive high-yielding option amid ongoing liquidity in the banking system.

Demand was overwhelmingly concentrated on the 364-day tenor. It attracted subscriptions of N4.40 trillion against an offer of N800 billion. The DMO allotted N808.78 billion for this tenor and used the strong interest to reduce borrowing costs.

For the 364-day Treasury bill:
Offer: N800.0 billion
Subscription: N4.40 trillion
Allotment: N808.78 billion
Stop rate: 16.99%, down 137bps from January’s 18.36%.

For the 182-day Treasury bill:
Offer: N200.0 billion
Subscription: N123.41 billion
Allotment: N80.61 billion
Stop rate: 16.65%, unchanged.

For the 91-day Treasury bill:
Offer: N150 billion
Subscription: N66.05 billion
Allotment: N63.21 billion
Stop rate: 15.84%, unchanged.

The auction results reveal robust appetite for longer-term NTBs. This gave the DMO the flexibility to lower the stop rate on the one-year paper while keeping rates stable on the shorter tenors.

The 364-day bill recorded unprecedented oversubscription. In contrast, the 91-day and 182-day tenors failed to attract bids matching their offered amounts.

The 91-day bill received N66.05 billion in bids against a N150 billion offer. The 182-day bill attracted N123.41 billion against a N200 billion offer.

Stop rates on both the 91-day and 182-day bills remained unchanged at 15.84% and 16.65%, respectively.

Analysts observe that the sharp decline in the 364-day stop rate demonstrates the DMO’s enhanced pricing power. It also reflects growing market confidence in long-term government securities.

The near 299% oversubscription highlights persistent liquidity flowing into risk-free assets. Investors continue to favour NTBs over equities and other higher-risk instruments.

The DMO’s decision to under-allot relative to subscriptions and to reduce the one-year yield points to deepening market depth. It also shows sustained investor interest in longer-dated bills despite the government’s elevated borrowing requirements.

The 364-day NTB stop rate declined sharply by 137 basis points to 16.99%, compared with 18.36% at the January 2026 auction.

This drop reflects intense investor demand for longer-dated bills. It provides the DMO with greater ability to lower overall borrowing costs.

In contrast, stop rates on the 91-day (15.84%) and 182-day (16.65%) tenors stayed the same as in the January 2026 auction.

The significant reduction in the one-year yield continues the pattern seen in January 2026. Back then, oversubscription, particularly on the 364-day paper, allowed the DMO to cut rates despite constrained liquidity and high benchmark interest rates.

This outcome represents a shift toward more favourable conditions for the issuer. It benefits government finances while offering investors stable, longer-term returns.