Nigerian interbank rates rise on cash shortage

Nigeria's interbank lending rates rose on Friday to an average of 12 percent from 9.25 percent last week after a series of cash outflows from the banking system drained liquidity.
Traders said interbank rates hit 30 percent in early trade following cash withdrawal by state-owned energy company NNPC and central bank's cash reserves requirements (CRR) debit as well as large open market operations bill sales by the regulator.
"(The) market rate went as high as 30 percent today on cash shortage, before some banks were credited with CRR surplus, bringing down rates to an average of 12 percent," a trader said.
The central bank had debited some lenders for unspecified amounts to meet their CRR but later credited some bank accounts with surplus from the debit, putting more cash into the system.
Secured Open Buy Back (OBB) traded at 12 percent on Friday, up from 9 percent last week and 1 percentage point below the 13 percent central bank's benchmark rate.
Overnight placement also climbed to 12 percent from 9.5 percent from last week.
Traders said rates should ease next week as a portion of budgetary allocations for the month of June is still being expected to filter into the money market by mid-week.