Nigerian interbank rates up 3.75 pct on CRR debit

CBN acting gov, Alade

Nigerian interbank lending rates rose on Wednesday by 3.75 percentage points on overnight placement to 14 percent, after central bank recalled about 230 billion naira ($1.40 billion)from the banking system to meet a new cash reserves requirement (CRR )on private sector deposits.
Traders said the open buy back (OBB) and overnight rate climbed from 10.25 percent the previous day, owing to a scramble for funds by banks to cover their positions after the debit.
Nigeria central bank hiked CRR on private sector deposits with banks to 15 percent, from 12 percent, at the end of its monetary policy committee meeting last month in a bid to tighten liquidity and support the local currency.
Traders said cash deposits held by banks with the central bank opened with a surplus cash balance of about 450 billion naira on Wednesday, but the CRR debit ked to scramble for funds to cover their positions.