The Central Bank of Nigeria (CBN) has lifted restrictions that previously prevented financial institutions accessing its Standing Lending Facility (SLF) from participating in foreign exchange (FX) and primary government securities transactions.

The new policy, which took immediate effect, is aimed at giving banks and other market participants greater flexibility in managing liquidity and improving the functioning of the country’s financial markets.

The apex bank announced the changes in a circular dated August 12, 2026, signed by its Acting Director, Financial Markets Department, Okey Umeano, and addressed to Deposit Money Banks (DMBs), authorised dealers and the general public.

According to the CBN, the decision followed a review of developments in the foreign exchange, money and fixed-income markets.

Under the revised framework, financial institutions that access the CBN’s Discount Window will no longer be barred from participating in the Nigerian Foreign Exchange Market (NFEM) or primary auctions of government securities.

The central bank, however, retained the restriction preventing institutions that access the Discount Window on a particular day from participating in Open Market Operations (OMO) auctions on the same day.

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

Through repo transactions, the CBN can inject or absorb liquidity from the banking system in exchange for eligible securities over a specified period. Under the new framework, repo operations may be conducted across tenors ranging from four to 90 days.

The CBN said the measure would strengthen liquidity management, improve money market operations and enhance the effectiveness of monetary policy transmission.

The revised framework also expands participation in OMO transactions, with eligible investors now able to participate in both primary and secondary markets through Deposit Money Banks.

Individuals, corporate entities and non-bank financial institutions are among those eligible to participate.

DMBs will continue to submit bids and settle transactions on behalf of their customers, effectively broadening access to OMO investments through the banking system.

Despite the wider participation, the CBN maintained its authority to determine the volume, tenor and frequency of OMO issuances based on prevailing liquidity conditions and monetary policy objectives.

The apex bank also retained the existing single-bid auction structure for OMO transactions.

The latest changes build on previous reforms to the CBN’s monetary policy and financial market operating framework, as the bank seeks to strengthen liquidity management and improve the role of market-based instruments in monetary policy implementation.

The revised rules provide a clearer distinction between financial market activities that could restrict access to central bank liquidity support and those that would not.

Participation in the FX market and government securities auctions will no longer constitute grounds for restricting access to the Discount Window.

The continued restriction on same-day OMO participation, however, preserves a safeguard against financial institutions simultaneously accessing CBN liquidity support and participating in the central bank’s own liquidity-management operations.

The resumption of four-to-90-day repo operations also gives the CBN an additional tool for managing liquidity over longer periods, beyond very short-term interventions.

The central bank directed banks, authorised dealers and other market participants to ensure strict compliance with the revised guidelines.