The Central Bank of Nigeria (CBN) has removed restrictions that prevented financial institutions using its Standing Lending Facility from participating in foreign exchange transactions and primary government securities auctions.

The revised framework, announced in a circular dated August 12, 2026, takes immediate effect and is aimed at giving banks and other market participants greater flexibility in managing liquidity.

Under the new rules, institutions that access the CBN’s discount window will no longer lose access to the facility because they participate in the Nigerian Foreign Exchange Market (NFEM) or primary auctions of government securities.

The decision follows a review of developments in the foreign exchange, money and fixed-income markets.

However, the CBN has retained a restriction on institutions participating in Open Market Operations (OMO) auctions on the same day they access the Discount Window.

The revised framework also expands access to OMO transactions. Individuals, corporates and non-bank financial institutions are now eligible to participate in primary and secondary OMO markets through Deposit Money Banks.

DMBs will continue to submit bids and settle transactions on behalf of their customers.

The CBN said it would retain control over the volume, tenor and frequency of OMO issuances, depending on prevailing liquidity conditions and monetary policy objectives. The existing single-bid auction structure will also remain in place.

CBN Restores Tenored Repo Operations

The new framework also provides for the resumption of tenored repurchase, or repo, operations, which had previously been suspended.

Under the arrangement, the CBN can conduct repo operations across approved tenors ranging from four to 90 days.

Repos allow the central bank to inject or absorb liquidity against eligible securities for a specified period, providing an additional tool for managing liquidity within the banking system.

The CBN said the changes were part of broader efforts to improve money market functioning, strengthen liquidity management and enhance monetary policy transmission.

The revised rules also clarify which market activities should restrict access to central bank liquidity support.

While participation in the FX market and government securities auctions will no longer constitute grounds for restricting access to the Discount Window, the same-day OMO restriction remains.

The CBN directed banks, authorised dealers and other market participants to comply strictly with the revised framework.