ABUJA, Nigeria — The Central Bank of Nigeria (CBN) has lifted restrictions that previously limited banks' access to its Standing Lending Facility (SLF) when they participated in the Nigerian Foreign Exchange Market (NFEM) or primary auctions of government securities.

The apex bank announced these changes in a circular signed by Okey Umeano, the Acting Director of the Financial Markets Department, on Wednesday. This review was prompted by an assessment of recent developments and established practices within the foreign exchange, money, and fixed-income markets, as well as the operational frameworks for accessing the SLF, Tenored Repo Operations, and participating in Open Market Operations (OMO).

However, the CBN clarified that existing restrictions on institutions accessing the Discount Window from participating in OMO auctions on the same day will remain in place.

The regulator also announced the lifting of the suspension on Tenored Repo Operations. This move is intended to provide banks with greater flexibility in managing their liquidity. The CBN stated it may now conduct repo operations with tenors ranging from 4 to 90 days to support effective liquidity management, improve money market functioning, and enhance monetary policy implementation.

Furthermore, the CBN has revised its OMO participation framework. This revision will permit a wider array of investors to engage in both primary and secondary OMO markets. These eligible investors include individuals, corporations, and non-bank financial institutions. Deposit Money Banks (DMBs) will continue to manage the bidding and settlement processes on behalf of these customers.

The volume, tenor, and frequency of OMO issuances will continue to be determined by current liquidity conditions and the CBN's monetary policy objectives. OMO auctions will still utilize the existing single-bid auction format.

These new provisions are effective immediately. The CBN has directed all banks, authorised dealers, and other market participants to ensure strict adherence to the updated guidelines.