₦airaland Forum

coolguyz: Another point to share is that following announcement in the middle of the month of August 2012 that JP Morgan index will be listing FGN Bonds in its index by October 2012, there was significant increase in demand for bonds especially from foreign investors with preference for the long dated maturities. This renewed demand forced yields down as prices on maturities of those bonds trading rose steadily.

Note that for a while now, the yield on bonds have been high and prices trading at low levels which had made the secondary trading activities on the bond's very dull as most of the banks are sitting on negative mark to market positions on these bonds and have moved significant portions to theri Held To Maturity portfolio.

It is believed that we may witness further decline in yields if these renewed demands level continue as it also pave more options on raising funds for the government. This will surely impact on TBills yield.

So we expect the yields on the Tbills to drop further abi? but do you think they will drop below the Inflation rate of 12.8%?

Cos once the yields on Tbills drop below that rate, it will no longer make sence purchasing the bills!!

Nettuno: @feelamong, I sent you a mail over a week now for some information on TB, but am yet to hear from you. Pls reach me on Larrychuksg@yahoo.com.

I don reply u!!

wura2020: Please how is the interest on 91 days TB calculated? The interest posted to me does not agree with my own calculation.

Just do the layman simple interest calculation for the funds you have. It gives you the interest you will get if you are to pick your interes upfront!

FunmyKemmy: I am in Ibadan. How can I be part of this? Kindly link me up please.

Walk into any bank there in Ibadan and ask them abt Tbills. If they cannot help u let us know ASAP.

Fortissimo: Yep, confirmed. 13.64% for 91 days. My fund managers bid was 13.60%. Amazing!

This ur fund manager na winch!!! [

he as clearly on the spot! Enjoy!!

issehfresh: Hello@feeling,
pls, what guy does ur Tbills 4 you? 'hope you would n't mind linking me up.tnx!

just send me a mail and I will send his contact details to you. feelamong@gmail.com

buJu-234:
@ coolguyz

whats ur source? am still looking for the source?

any way ; thank God i bidded for 13.5% for 91days

You cant get any source here! the rates aare as stated by Coolguyz. My bankers confirmed this to me last nite!

coolguyz: Below are the stop rates for the treasury bills auction held on 05-Sep-2012;


91 days 13.64%
182 days 13.80%
364 days 13.8726%

Yields have really dropped on all maturities even the long dated TBills.

Good one!!! just as expecetd!! I actually bidded 13.5%

The long dated ones will for now be witnessing lower yields! with the expectant listing of FGN Bonds in JP Morgan Index by October, I suspect that many foreign investors are already trying to lock in long term Tbills cos they expect the yields to drop more as more investors become more aware of our cheap Bonds/Tbills.

At this rate if the yields drop further, am off to the NSE to pick up the bargains am seeing there now!

Hmmm So it means the price of my Agege will go up by 20%

well, cassava bread; here we come! But GEJ must go in for this!

Excellent Thread!

Am in for any life forum in Lagos. The problem many of us have been having while trying to diversify and creat multiple stream of income is that fact that most Nigerians are not very good with Trust. But I have also seeen very excellent and dependable people. I hope our forum will bring out people of impeccable character who many of us could leverage on to do big business in Naija!

feelamong: The next Tbills Auction is scheduled for the 6th of Sept 2012.

Just wondering what the rates will look like.....most fund managers seem to agree that we will likely be seeing a slight drop in the rates!

The next three days will defitnitely give us more clue on the direction of the market!

http://af.reuters.com/article/nigeriaNews/idAFL6E8JTAQJ20120829

LAGOS Aug 29 (Reuters) - Nigeria plans to issue 142.97 billion naira ($903.73 mln) in treasury bills ranging from 3-month to 1-year maturities at its regular twice-monthly auction on Sept. 6, the central bank said on Wednesday.

The bank said it will raise 32.97 billion naira in 91-day notes, 50 billion naira in 182-day bills and 60 billion naira in the 264-day paper.

Nigeria, Africa's second biggest economy after South Africa, issues treasury bills regularly to reduce money supply, curb inflation and help lenders manage their liquidity. ($1 = 158.20 naira) (Reporting by Oludare Mayowa; Editing by Tim Cocks)

The next Tbills Auction is scheduled for the 6th of Sept 2012.

Just wondering what the rates will look like.....most fund managers seem to agree that we will likely be seeing a slight drop in the rates!

The next three days will defitnitely give us more clue on the direction of the market!

http://www.businessdayonline.com/NG/index.php/news/76-hot-topic/43368-seven-firms-scale-technical-bids-for-power-plants-bpe

Seven firms out of the 25 original bidders have scaled the technical evaluation hurdle to qualify for the financial bids process under the federal government privatization programmes of the five power generation plants across the country.

The successful firms who were allowed to do multiple bidding, will however not be allowed to win more than one of the bids and even if they do, they will eventually be allowed to settle for one as the rules do not allow for a winner to take charge of more than one firm.

Atedo Peterside, member of the National Council on Privatization, NCP stated this Friday while speaking to newsmen after the NCP meeting presided over by Vice President Namadi Sambo, at the Presidential Villa, Abuja.

Phoenix Electricity, Transcorp and Ampiron Power Distribution Limited were listed as successful bidders who scaled the technical evaluation hurdles for the Ughelli Power Plant.

"For Ughelli Power Plant, we have the following bidders who attained the pass mark of 750: Phoenix Electricity, Transcorp, and Ampiron Power Distribution Limited. They are the ones that will proceed to the financial bid opening".

Two bidders scaled the hurdles for the Sapele Power Plant. They include; CMEC Energy and GPN Nestoil Power Services Limited.

The two bidders, he said attained the pass mark of 750 and above to qualify for the financial bid evaluation stage.

Ampiron Power Distribution Company also got the nod to proceed to the financial bid evaluation stage for the Gereku Power Plant.

feelamong: Hmmmmm.......lets just hope that there wont be any Pro rating for the 'large number' of bids with 14%!

http://af.reuters.com/article/nigeriaNews/idAFL6E8JO6OV20120824

LAGOS Aug 24 (Reuters) - Nigeria sold 20 billion less than planned at a bi-monthly sale of treasury bills on Thursday but the yields on its 3-month bills fell, with dealers citing large purchases by foreign players.

The central bank sold just 50.65 billion naira ($321 mln) in 3- and 6-month bills compared to plans announced last week for an auction of up to 70.65 billion naira.

Dealers said the bank had rejected bids that were higher than it was prepared to pay for short-dated papers, pushing yields down to 14 percent from 14.5 percent at a previous sale two weeks ago.

That pointed to pent-up demand for the currency from foreign players, and the naira firmed to 157.80 at 1102 GMT against the U.S. dollar on the interbank market, recovering from a low of 158.10 naira where it closed the previous day.

The bank auctioned 20 billion naira of 182-day paper at a yield of 15.08 percent, compared with 15.30 percent it sold on Aug.9.

Nigeria issues treasury bills twice-monthly to reduce the money supply, curb inflation and help lenders manage their liquidity.

Total subscriptions for the bills were 136.91 billion naira. ($1 = 157.95 naira) (Reporting by Oludare Mayowa; Editing by Chijioke Ohuocha and Patrick Graham)

Ojix85: Well, i hit the stop rate of 14% sharp, for 91days... Thanks a lot for the encouragement.

Hmmmmm.......lets just hope that there wont be any Pro rating for the 'large number' of bids with 14%!

Ojix85: Hi guys.

This will be my second time i will be trying to invest in Treasury Bills and GTBank keeps messing me up.

I called them yesterday when i noticed that my account has not been debited. The investment peeps said that will be done either yesterday or today, but i really doubt.

I have no choice but to pull my funds from this silly bank.

Well, I think you should wait and see. Usually my account is debited on Fridays. but then i hope you did not bid above the CBN stop Rates!

Ojix85: @Feelamong:

Pls introduce me to your account manager. Need some help here.

send ur email address to me or send me a mail on feelamong@gmail.com

Americas_man: The rate I got from first bank is 12.02% 91days. I wonder why? Please poster, How can I get a good rates. These banks keeps giving me very bad rates. Do you think the rates re from the secondary market?

I believe they must have quoted a Secondary market rate to you. Tell them you want to bid in the Primary market auction!

Dada-Stephen:
Chiarman abeg,
I've got interest in this Tbills stuff, but u guys should pls help novices like me.
Make it simple:
What r Tbills? How much is d minimum to maximum investment rate and what is the profit or interest like?
Wher can I get it?
Thanks

Broda...just take ur time and read thru the thread..wont be nice sounding like a broken record to others who have been following the thread.

In summary Tbills are discounted Debt Instruments issued by the CBN by the order of FGN. It means you are borrowing money to the FGN at an interest rate (Discount Rate). The good thing here is that you can actually collect your interest upfront and it is Risk Free and Tax free. Moreover you actually get far higher rates that you will ordinarily get from your investments in Fixed deposits.

The minimum amount where i invest is N1M. Just talk to your bankers. If they cannot help then you can give me a shout to introduce you to my account officer.

Shalom!!

CBN STOP RATES!!

91Days ------14%

182 days ------15.08%

Rates dropped but still not bad!

coolguyz: in addition to @feelamong's statement, note that you can also buy treasury bills on the secondary market. You need not wait for primary auctions or OMO auctions to invest in treasury bills. The secondary market is like you buying an already issued maturity which is being traded. Registered Primary Market Dealers (banks and discount houses) atimes sell from their existing portfolio to investors and can take instructions to buy specific maturities from the market on your behalf.

Will be willing to answer further enquiries

@feelamong. . . will send you my details. keep up the good work!

A lot of people have been sending mails to me on Tbills asking for where they could actually invest as low as N100K - N500K. Can You advise on any Discount House that accepts as low as that. My bankers do not accept below N1Million.

webstradamus: How does this secondary market work and how can one participate?

Tried playing in this secondary market a couple of times but never enjoyed it. You need loads of cash to actuallplay well here otherwise the big banks will just fry u.

The idea is to buy high and sell low.

coolguyz: expectation ranges as follows -

91 days: 14.00% - 14.65%
182 days: 14.95% - 15.55%

**please note these are expectations based on the market reading and not CBN stop rates!

Thanks a lot my Chairman. Pls I need ur email. We need to share a few tips on the market.

I usually do the 91 days and after talking to my brokers most of them are looking at 14.25% for that. I will stick your lower limit of 14% .

http://www.channelstv.com/home/2012/08/15/cbn-to-issue-n71billion-treasury-bills/

CBN to issue N71billion Treasury bills


The Central Bank of Nigeria (CBN) has announced plans to issue N70.65 billion ($445.18 million) in treasury bills ranging from 3-month to 6-month maturities.

The apex bank made the announcement on Wednesday, stating that the treasury bills will be issued at its regular bi-monthly debt auction next week, as part of measures to tighten liquidity.

The bank said it will issue N30.65 billion in 91-day bills and N40 billion in 182-day bills on August 23.

On behalf of the federal government, the CBN issues treasury bills regularly to reduce money supply, curb inflation and help lenders manage their liquidity.

Toomaxi: Pls market analysts ur people's help ar highly needed nw cos my brother want to make a mistake. He's abt to buy Access shares whch is at 7.4 per sh nw bt i told him instead dt he should go for UBA or Diamond because of Access share price depreciatn . Pls i need ur advice wit reasons

We have seen the good results declared by bothe UBA and Access bank in their Half year results. In the long term they are all ok to buy.

As for Access, I will tread with caution, although at the moment they are one of the biggest banks in Nigeria, moreover their EuroBond Floatation was a major success thus the prospect of doing more foreign currency transactions at less cost..however this alsoo comes with the risk of currency devaluation since the core of their business is being done in Naira.

In all I will go for Access bank as they have a greater propsect of growing their earnings better.

We are not broke!!! This was exactly what the countries of Greece, spain etc were saying 5yrs ago!!

Only time will tell!!!

webstradamus: Well said! Unfortunately, you only get what you bid provided it doesn't exceed the yield rate. And that's what makes bidding kinda difficult. Imagine me bidding 15% last week and then 14.94% ended up being the stop rate. I got scared this time and bid 14.75% only for it to yield 15.30%. Am so mad at myself now

This is the beauty of the game!

I enjoy the fact that there is some element of 'gambling' in bidding for Tbills. But what i do most times is to speak to about 3 -4 fund managers/Dealers in discount houses and Bank Treasury to seek their opinion. Moreover one has to do some sort of research as per what the Interbank rates are doing and how tight is the liquidity in the market before any Tbills auction.

But; in all you might never get the exact Stop Rates! but all times you will get a rate far better than any Fixed deposit!

http://af.reuters.com/article/nigeriaNews/idAFL6E8J9BDZ20120809

LAGOS Aug 9 (Reuters) - Nigeria sold 172.1 billion naira ($1.1 billion) in treasury bills, more than expected, and increased the yield it offered on the short-dated paper to mop up liquidity to support the currency, the central bank said on Thursday.

The bank said last week it would auction 142.1 billion naira of treasury bills with maturities of between three months and one year. It gave no reason for the additional 30 billion naira of issuance.

The naira surged 1.1 percent to a more than two-week high on the interbank market on Thursday following the sale and after state-owned energy company NNPC sold $450 million to banks in exchange for the local currency.

The central bank said it had sold 50 billion naira of 182-day Treasury bills at a yield of 15.30 percent, higher than 14.94 percent at its previous auction last month.

It sold 90 billion naira of 364-day bills at a yield of 15.38 percent, compared with 15.60 percent a month ago, and 32.06 billion naira of 91-day bills at a yield of 14.5 percent, higher than 13.94 percent at the last such auction a month ago.

Nigeria issues treasury bills twice monthly to reduce the money supply, curb inflation and help lenders manage their liquidity.

Overnight lending rates spiked on Wednesday to more-than two-year high of 35 percent, partly because of the treasury bill sale and a foreign exchange auction of $318 million which soaked up naira liquidity.

The bank two weeks ago left its benchmark interest rate on hold at 12 percent but raised the cash ratio for lenders to 12 percent from 8 percent, to tighten liquidity.

Total subscriptions for the bills were 422.82 billion naira. ($1 = 160.05 naira) (Reporting by Oludare Mayowa; Editing by Chijioke Ohuocha and Catherine Evans)

Seun: Regardless of what you bid, every winning bidder should get the same rate at the end of the auction. Am I wrong about this?

Clearly you are wrong on this! You will only be availed at the rate you bidded for! Pronto!!

So would this reduce the cost of Amala or of the gbomo or shaki that Mama Sikira has increased its price since January fuel price increase??

The CBN stop rates for the Tbills auction yeaterday were as follows:

91 DAYS ------14.5%

182 DAYS ------15.30%

364 DAYS ------15.38%

Good one for investors!!!