The Central Bank of Nigeria (CBN) injected more than N1.7 trillion into the banking system in the first week of February 2026, primarily through repayments of maturing Open Market Operations (OMO) bills and primary market instruments, according to an analysis of the apex bank’s financial activities from February 2 to February 6.
The liquidity inflow came as the CBN maintained its aggressive monetary tightening stance aimed at controlling inflationary pressures and supporting stability in the foreign exchange market, reflecting a careful balance between easing short-term liquidity pressures and sustaining overall monetary discipline.
Financial data show that the bulk of the N1.72 trillion inflow was driven by maturing instruments rather than new liquidity creation.
The largest single injection occurred on February 3, when N1.03 trillion in OMO bills matured. Additional primary market repayments contributed N668.87 billion on February 5 and an earlier N24.38 billion redeemed earlier in the week.
Rather than issuing fresh OMO bills to mop up funds, the CBN relied on Nigerian Treasury Bill auctions across the 91-day, 182-day, and 364-day tenors to absorb excess liquidity, signaling its cautious approach to re-injecting funds into the system.
Despite the sizeable inflows, banks exhibited cautious behaviour, reflecting continued tight liquidity conditions and elevated risk aversion. Many institutions preferred placing surplus funds with the apex bank rather than expanding interbank lending or credit.
Standing Deposit Facility (SDF) balances peaked at N2.65 trillion on February 5 before easing slightly to N2.49 trillion on February 6, highlighting a continued preference for risk-free placements.
Opening balances of banks and discount houses remained relatively low, fluctuating between N85.59 billion and N163.8 billion throughout the week.
The combination of low opening balances and high SDF holdings underscores persistent funding tightness despite the headline liquidity injections.
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Analysts attribute this behaviour to elevated interest rates and ongoing market uncertainty, which continue to influence banks’ liquidity management strategies.
The pattern of repayments and liquidity management underscores the delicate balancing act the CBN is pursuing: allowing large instrument maturities to flow through the system while using alternative tools to prevent a sustained surge in excess liquidity.
For banks, the environment implies continued pressure on funding costs and cautious lending behaviour. Fixed-income investors can expect sustained demand for treasury bills and bonds, with elevated yields likely to persist.
For the broader economy, tight financial conditions suggest that credit growth may remain constrained in the near term.
The short-term relief provided by cumulative repayments does not signal a shift away from the CBN’s broader tightening bias. January 2026 saw the apex bank sterilise over N15 trillion from the banking system through OMO and treasury bill issuances—one of the most aggressive mop-ups in recent history—pushing funding costs higher and intensifying interbank rate pressures.
Looking ahead, analysts estimate that February could see inflows of about N8.61 trillion from OMO, treasury bill, and coupon maturities.
However, liquidity is expected to remain tight as the CBN continues to prioritise price stability and foreign exchange market equilibrium, signalling that banks and investors must navigate a constrained financial environment in the coming weeks.