CAPITALDIGEST DAILYNEWS, 15/06/2026

NEW CRUDE STREAMS ADD 12M BARRELS TO NIGERIA’S OUTPUT

Nigeria’s ambition to raise crude oil production has received a boost from the growing contribution of newly introduced crude grade streams, Utapate and Cawthorne, Saturday PUNCH reports. The crude grades, introduced in 2024 and early 2026, represent the latest additions to the country’s basket of crude oil grades aimed at expanding export streams and strengthening oil revenues. Based on the Nigerian Upstream Petroleum Regulatory Commission’s monthly crude and condensate production data analysed by our correspondent on Friday, the Utapate crude grade produced a total of 8.75 million barrels between January and May 2026, while the newly introduced Cawthorne blend contributed 3.41 million barrels during the same period, bringing the combined output from both crude grades to approximately 12.16 million barrels. The data also showed that Utapate has yet to achieve its projected output target announced by the government, even as production remained more than 20,000 barrels per day below the 80,000 bpd target set by operators. The figures showed that Utapate recorded an average daily production of 55,190 barrels in January. Based on the 31-day month, this translated to a total monthly output of 1.71 million barrels. Output increased to 57,970 barrels per day in February, yielding about 1.62 million barrels, before rising marginally to 58,020 barrels daily in March, equivalent to roughly 1.80 million barrels. In April, the field attained its highest daily production level of 59,290 barrels, producing an estimated 1.78 million barrels during the month. Production moderated slightly to 59,170 barrels per day in May but still generated approximately 1.83 million barrels due to the longer calendar month. However, despite the upward trend, the data indicated that Utapate remained significantly below the 80,000 barrels-per-day target. The field fell short by 24,810 barrels daily in January, 22,030 barrels in February, and 21,980 barrels in March. The production gap narrowed to 20,710 barrels per day in April before widening marginally to 20,830 barrels in May. The development suggests that although operators have made progress in scaling up production, the ambitious target announced earlier by the Nigerian National Petroleum Company Limited has yet to be realised. The Utapate field, which commenced production in May 2024, had been projected to achieve 80,000 barrels per day by the end of 2025. Speaking at the launch of the Utapate crude blend in July 2024, the Managing Director of NNPC E&P Limited, Nicholas Foucart, expressed confidence that ongoing development projects would substantially increase production capacity. “We have several ongoing projects to increase our production from the current 40,000 bopd to 50,000 bopd by January 2025, and 60,000 bopd to 65,000 bopd by June 2025. Essentially, we are targeting opportunities to increase production to 80,000 bopd by the end of 2025,” Foucart said. The Utapate crude blend was introduced into the international market by NNPCL and its partner, Sterling Oil Exploration and Energy Production Company Limited, following the lifting of the maiden cargo of 950,000 barrels destined for Spain. Produced from Oil Mining Lease 13 in Akwa Ibom State, the crude grade possesses characteristics that have attracted international interest. It has a sulphur content of 0.0655 per cent and a relatively low carbon footprint resulting from flare gas elimination. Foucart had described the introduction of the blend as “a significant milestone for Nigeria’s crude oil export to the global energy market.” According to him, OML 13, which is fully operated by NNPC Exploration and Production Limited and Natural Oilfield Services Limited, a subsidiary of SEEPCO Limited, holds reserves estimated at 330 million barrels of crude oil, 45 million barrels of condensate and 3.5 trillion cubic feet of gas. He added that the Utapate terminal was designed to meet global environmental standards. “The Utapate crude oil terminal is sustainable, affordable and fully compliant with the rigorous environmental regulations and sustainability principles, especially those aimed at reducing carbon emissions and other ecological effects,” he stated. Meanwhile, another emerging crude stream, Cawthorne, contributed 3.41 million barrels to Nigeria’s production between January and May, according to the NUPRC data. The figures showed that Cawthorne’s average daily production rose sharply from 12,340 barrels in January to 16,450 barrels in February and 23,970 barrels in March. The field sustained the momentum in April, reaching 30,970 barrels per day before easing slightly to 28,940 barrels daily in May. The monthly production volumes translated to 382,540 barrels in January, 460,600 barrels in February, 743,070 barrels in March, 929,100 barrels in April and 897,140 barrels in May. NNPC Ltd had recently announced the commencement of exports from the Cawthorne blend, describing the development as part of efforts to increase Nigeria’s crude oil production and strengthen the country’s position in the global energy market. In a statement, the Chief Corporate Communications Officer of NNPC Ltd, Andy Odeh, said the first cargo of the new grade was lifted aboard the MT Eburones vessel for shipment to the Netherlands. “The Nigerian National Petroleum Company Limited has commenced export of its new crude grade, Cawthorne, marking a significant milestone in the company’s drive to increase Nigeria’s crude oil production and expand its portfolio of globally competitive export streams,” Odeh said. He added, “Cawthorne blend crude, the latest addition to Nigeria’s basket of crude grades, has an API gravity of 36.4, placing it firmly within the light, sweet category, comparable to Bonny Light, and highly valued in the global market for its superior petrol and diesel yields.” According to him, the maiden cargo, estimated at 950,000 barrels, was exported through the Cawthorne Floating Storage and Offloading vessel located offshore Bonny, Rivers State. “The cargo was exported via the Cawthorne Floating Storage and Offloading vessel, which is strategically located offshore Bonny. The facility enhances crude evacuation from OML 18 and strengthens Nigeria’s export reliability, operational efficiency and overall energy security,” Odeh stated. The emergence of both Utapate and Cawthorne underscores Nigeria’s determination to diversify its crude export portfolio and maximise oil earnings. However, the latest NUPRC figures also highlight the operational challenges facing producers as they strive to convert ambitious output targets into actual barrels. Combined, Utapate and Cawthorne contributed an estimated 12.16 million barrels of crude oil between January and May, providing additional support to Nigeria’s broader efforts to sustain production growth and improve foreign exchange earnings from the oil sector.On Thursday, the NUPRC reported that Nigeria’s crude oil production rose above its Organisation of the Petroleum Exporting Countries quota in May 2026, with the country recording its highest crude output in 15 months amid improved operational stability and the absence of major disruptions across key oil facilities. Data released showed that Nigeria produced an average of 1,530,354 barrels of crude oil per day in May, representing 102 per cent of the country’s 1.5 million barrels-per-day quota approved by OPEC. When condensate production of 170,446 barrels per day is added, Nigeria’s total oil output climbed to 1,700,800 barrels per day, further strengthening the country’s position as Africa’s largest oil producer and boosting revenue.

BANKS EARN N225BN FROM ATM, E-BANKING CHARGES

Nigerian banks generated N224.69bn from electronic banking services and ATM/card-related charges in the first quarter of 2026, representing a 12.56 per cent increase from N199.61bn recorded in the corresponding period of 2025, an analysis of the unaudited financial statements of 11 listed lenders has shown. The increase came as banks continued to deepen digital banking adoption and electronic payment services, with income from e-banking channels accounting for a significant share of non-interest revenue during the period under review. Findings by The PUNCH showed that electronic banking and ATM/card management fee income rose by N25.06bn year-on-year, from N199.61bn in Q1 2025 to N224.67bn in Q1 2026. A breakdown showed that income from electronic banking and e-business activities increased by 11.57 per cent to N177.97bn from N159.52bn recorded a year earlier. Similarly, earnings from ATM and card management fees climbed by 16.48 per cent to N46.70bn from N40.09bn in Q1 2025. The growth in digital banking revenue coincided with a broader increase in banking sector fee income. The PUNCH earlier reported that the total fee and commission earnings of the 11 lenders rose by 13.64 per cent to N984.47bn from N866.30bn. Also, account maintenance fee income increased by 14.07 per cent to N209.18bn from N183.37bn. Among the lenders reviewed, Access Holdings recorded the highest earnings from e-banking services, generating N55.71bn in Q1 2026. UBA followed with N46.93bn, while Ecobank earned N35.53bn from card management fees. GTCO posted N21.90bn in e-business income, and Zenith Bank generated N21.54bn from electronic product fees. Other notable contributors included First Holdco with N20.75bn, Wema Bank with N6.10bn, Fidelity Bank with a combined N8.81bn from ATM charges and e-banking commissions, Stanbic IBTC with N4.33bn from card-based commissions and electronic banking fees, Sterling Financial Holdings with N2.89bn, and Jaiz Bank with N187.05m. An analysis of growth rates showed that Fidelity Bank recorded the strongest expansion in digital banking-related income. The lender’s combined ATM charges and e-banking commissions rose by 164.9 per cent to N8.81bn from N3.08bn in the corresponding period of 2025, driven largely by a 240.8 per cent jump in ATM charges. GTCO followed with a 68.64 per cent increase in e-business income to N21.90bn from N12.99bn. Stanbic IBTC’s combined card-based commission and electronic banking income rose 52.8 per cent to N4.33bn, while Zenith Bank’s fees on electronic products increased by 58.91 per cent to N21.54bn. Sterling Financial Holdings recorded a 22.15 per cent increase in e-business commissions and fees, while Access Holdings posted a 15.2 per cent rise in channels and e-business income to N55.71bn. However, some lenders recorded declines in digital banking-related income. Wema Bank posted the sharpest decline, with fees on electronic products dropping by 50.68 per cent to N6.10bn from N12.37bn. Stanbic IBTC’s electronic banking fees declined by 20.57 per cent to N865m, while UBA’s electronic banking income slipped marginally by 1.91 per cent to N46.93bn. Ecobank’s card management fees also declined slightly by 1.52 per cent to N35.53bn. Further analysis showed that digital banking channels accounted for a significant portion of banks’ fee income. At Access Holdings, e-banking income contributed 27.2 per cent of total fee and commission earnings of N205.03bn. GTCO derived 27.27 per cent of its fee income from e-business services, generating N21.90bn out of N80.31bn total fee income. UBA’s electronic banking income represented 37.82 per cent of its N124.07bn fee and commission revenue, making it the bank’s largest fee-generating line item. First Holdco generated 21.59 per cent of its fee income from electronic banking services, while Zenith Bank earned 25.4 per cent of its fee and commission income from electronic product fees. Ecobank’s card management fees accounted for 14.94 per cent of total fee income, while Wema Bank’s electronic product fees contributed 35.08 per cent despite the sharp decline recorded during the quarter. Stanbic IBTC’s combined card-based commission and electronic banking income represented 5.21 per cent of total fee income, while Sterling Financial Holdings generated 17.13 per cent of fee income from e-business commissions and fees. The strong performance of digital banking income comes amid signs of improving economic activity, according to analysts.  Nigeria’s private sector expanded to a nine-month high in May 2026, with the Stanbic IBTC Purchasing Managers’ Index rising to 54.1 points on the back of stronger demand, increased output and improved logistics. The growth also aligns with ongoing reforms in the banking sector. Earlier this year, the Central Bank of Nigeria said financial-sector reforms, including the recapitalisation programme and efforts to stabilise the foreign exchange market, were strengthening the foundations of the economy and positioning banks to support long-term growth. Digitalisation of financial services has also become a major policy conversation across Africa, with development institutions increasingly linking digital payments and electronic banking adoption to economic formalisation, financial inclusion and government revenue mobilisation. In its Africa Economic Outlook 2026 report, the African Development Bank said digitalisation was helping countries lower the cost of business registration, reporting and payments, making it easier for firms and individuals operating outside the formal economy to participate in regulated financial systems. The report noted that countries with higher usage of digital public administration services tend to record stronger domestic revenue mobilisation and lower levels of informality. According to the AfDB, digital platforms improve taxpayer registration, enhance transaction traceability and strengthen compliance monitoring, enabling governments to capture previously unregistered economic activities without increasing tax rates. The bank stated that digitalisation also improves administrative efficiency, reduces leakages and broadens the tax base, creating a sustainable pathway for strengthening domestic resource mobilisation and fiscal capacity. Beyond revenue generation, the AfDB said digitalisation promotes economic and financial inclusion by providing informal businesses with access to digital payment platforms and financial services. The report stated that digital financial tools enable small businesses to build transaction histories, reduce information gaps with lenders and gain access to savings, credit and risk-management products. The AfDB explained that these developments help improve the resilience and productivity of micro, small and medium-sized enterprises while encouraging gradual migration from the informal to the formal economy. The growing contribution of e-banking, card services and other digital channels to banks’ fee income reflects the broader shift toward digital finance across Africa, as consumers and businesses increasingly rely on electronic payment systems for everyday transactions.

FIXED-INCOME TRADING SURGES TO N1.06TN — CBN

The Nigerian fixed-income market recorded a massive surge in liquidity and investor participation as total single-day trading volume crossed the N1tn threshold. Data released by the Central Bank of Nigeria from the official Fixed Income Dashboard on Thursday, 4 June 2026, reveals that market turnover reached exactly N1.06tn across 551 executed trades, driven by intense demand for short-term government debt instruments. Nigerian Treasury Bills emerged as the primary catalyst for the day’s historic turnover, accounting for more than half of the total market volume. Investors aggressively channelled capital into these short-term instruments, reflecting a highly active secondary market. According to the CBN official dashboard summary, “Treasury Bills led the market with 340 trades, pooling an impressive volume of N668,005,110,000, with 24 distinct market participants actively driving the momentum.” The deepest pocket of activity within the NTB segment was heavily concentrated in the one-year tenors expiring in June 2027. One standout instrument (ISIN: NGT030306275) single-handedly absorbed massive liquidity blocks, including a single transaction flight that reached an N65bn volume at a closing rate of 19.09 per cent. Other major tranches for the same maturity closed at yields as high as 19.54 per cent, indicating that investors are locking in near-20 per cent rates for 12-month sovereign paper. In tandem with standard Treasury Bills, the CBN’s Open Market Operations served as another key liquidity sponge, drawing sharp interest from institutional players, particularly in ultra-short positions. The dashboard highlighted the OMO breakdown, stating, “OMO Bills recorded a total volume of N224,408,000,000 across 43 trades, drawing in 11 key institutional participants as short-term yields continued to march upward.” A granular look at the OMO details shows that the shortest-term bills, specifically those maturing on 30 June 2026 (0.07 years to maturity), triggered the highest yields of the day, with closing rates hitting a peak of 22.00 per cent for a N56.2bn volume block. While short-term instruments flirted with 20 to 22 per cent interest rates, the Federal Government of Nigeria’s bond market showcased a starkly flattened yield curve. Investors showed a clear preference for mid-term tranches over long-dated sovereign debt. The FGN Bond performance profile noted, “The sovereign bond segment saw 168 trades yielding a total volume of N170,362,824,000, backed by 19 participating institutions.” The most actively traded paper was the February 2031 FGN Bond (4.72 years to maturity), which cleared N76.26bn in volume at a weighted average rate of 16.61 per cent. Intriguingly, the longest-dated instrument on the dashboard, the 27-year FGN Bond maturing in June 2053, settled at a much lower closing rate of 14.95 per cent on a modest volume of N6bn. Conversely, the June 2032 FGN bond (6.06 years to maturity) saw its weighted average rate spike to the highest in the bond category at 18.78 per cent, signalling that the medium-term sector of the curve is bearing the brunt of the market’s current yield premium. A comprehensive breakdown of the day’s trading activity highlights how the N1.06tn liquidity was distributed across the primary fixed-income asset classes. The Treasury Bill segment captured the lion’s share of activity, recording 340 trades and a dominant volume of N668.01bn with 24 active market participants. CBN OMO Bills followed as the next largest liquidity absorber, pulling in N224.41bn over 43 trades executed by 11 key institutional participants. Meanwhile, the FGN Bonds market maintained steady long-term interest, generating 168 trades that accounted for N170.36bn in volume across 19 participating institutions, all culminating in an aggregate of 551 trades and 25 unique market participants, driving the robust single-day performance.

CBN LIQUIDITY TIGHTENING TRIGGERS SHORT-TERM DEBT SHIFT

Fixed-income analysts are strongly advising institutional investors and fund managers to realign their portfolios towards short-dated sovereign instruments, following an aggressive liquidity mop-up by the CBN that has pushed Open Market Operations yields to highly competitive levels. The calls for tactical reallocation come on the heels of the latest primary market auction, where the apex bank offered N200.00bn across three distinct tenors. The exercise triggered an unprecedented wave of liquidity deployment, with total investor subscriptions shattering expectations to hit over N2.5tn. Market participants say the scale of demand reflects not only excess liquidity in the financial system but also heightened caution among institutional investors navigating an environment of sticky inflation, exchange rate volatility, and uneven fiscal buffers across key sectors of the economy.  Market sentiment is rapidly shifting as fixed-income desks react to the lucrative clearing rates offered by the monetary authority. “The CBN is sending a very clear message to the market: liquidity control remains the absolute priority, and they are willing to pay a premium to achieve it,” stated an investment research analyst at Meristem Securities. “With stop rates clearing at 21.80 per cent for the 11-day paper and 20.37 per cent for the 102-day instrument, analysts urge fixed-income investors to ride the OMO yield wave while these elevated windows remain open,” it added. The auction data reveals an intense concentration of demand at the longer end of the offered curve, where the 102-day maturity drew an astronomical N1.73tn in bids. The CBN eventually allotted N1.72tn to this segment and N220.00bn to the ultra-short 11-day paper, while completely rejecting all bids for the intermediate 39-day paper. Analysts interpret this skewed demand pattern as evidence of a market structure increasingly anchored on yield optimisation rather than tenor diversification, as investors crowd into instruments perceived as offering the best risk-adjusted return in a tightening liquidity cycle. Beyond the headline figures, dealers note that the heavy subscription levels also underscore the depth of idle liquidity in the banking system prior to the CBN’s intervention. With interbank rates tightening and liquidity buffers being actively sterilised, fund managers are recalibrating strategies to align with a policy environment that prioritises monetary tightening over growth support in the short term. The aggressive pricing of OMO bills has reverberated across adjacent fixed-income segments, triggering mixed reactions in the secondary markets. This shifting pricing structure became evident over the week as primary market OMO stop rates cleared at 21.80 per cent for the 11-day paper and 20.37 per cent for the 102-day paper, directly influencing broader trading desks. While the secondary Nigerian Treasury Bills market maintained relative stability with average yields edging down by a single basis point to 17.51 per cent, the sovereign bond market succumbed to notable selling pressure, pushing average long-term FGN bond yields up by eight basis points to settle at 16.32 per cent. Traders say this divergence highlights a fragmented response function across instruments, with shorter-tenor assets benefiting from liquidity chasing yield, while longer-dated bonds experience repricing pressure due to duration sensitivity. “We are witnessing a profound structural rotation out of long-term debt into short-term high-yield papers. The sharp volatility in the March 2027 bond, which saw its yield spike by 121 basis points in a matter of days, underscores a tactical retreat by asset managers who are trying to avoid duration risk while inflation risks linger,” noted a secondary desk dealer at a major tier-1 investment bank. Market analysts add that the steepening of yield pressures at the longer end is also being shaped by inflation expectations that remain insufficiently anchored, despite recent monetary tightening. This has created a scenario where investors increasingly demand a premium for holding duration, further accelerating the shift into short-term instruments. The aggressive positioning by local investors aligns with broader macroeconomic realities. Locally, though Nigeria’s economy showed positive structural resilience with a 3.89 per cent year-on-year GDP expansion in Q1, lingering inflationary pressures from late Q1 continue to keep investment committees cautious of locking up capital for extended durations. The GDP figure, while encouraging, masks significant sectoral disparities that continue to influence capital allocation decisions across institutional portfolios. “When you look at the macroeconomic backdrop, short-duration strategy is simply the most logical play right now,” explained an asset manager overseeing a leading pension fund. “The sheer volume of funds, N1.73tn, seeking a home in a 102-day OMO paper, proves that institutional mandates are locking in these guaranteed, risk-free returns. Why absorb the volatility of a five-year or 10-year bond at 16.3 per cent when you can capture over 20 per cent in less than four months?” Portfolio managers further note that regulatory frameworks governing pension and insurance funds are also reinforcing this shift, as risk-weighted capital considerations increasingly favour short-dated, highly liquid instruments during periods of monetary tightening. This has created a feedback loop where policy, regulation, and market behaviour reinforce the same directional bias toward short-term sovereign exposure.

BANKING SECTOR RECORDS $7.55BN FRESH CAPITAL INFLOWS

Nigeria’s capital importation recorded massive growth in the first quarter of 2026, surging 83.80 per cent year-on-year to hit a record $10.37bn, up from the $5.64bn recorded in Q1 2025. According to the weekly economic analysis released by an investment firm, Meristem Securities Limited, this sharp, broad-based acceleration in foreign participation was primarily channelled through the local banking system. “The banking sector stayed the primary gateway, attracting $7.55bn or 72.80 per cent of total inflows,” the report stated, adding that “financing activities followed at $2.43bn (23.40 per cent), leaving manufacturing at a marginal 1.50 per cent ($152.30m).” Analysts at Meristem noted that the current investment wave favours short-term instruments rather than long-term infrastructure. “This structure highlights that, despite the strong headline expansion compared to Q1 2025, capital importation remains largely a financial-market-driven cycle rather than a shift towards productive long-term investment,” the firm explained. The report attributed the revived offshore appetite for Nigerian fixed-income assets to recent macroeconomic reforms. “The strong year-on-year acceleration versus Q1 2025 was driven by improved FX market functioning, exchange rate flexibility, and relatively attractive domestic yields, which collectively restored offshore appetite,” Meristem noted. “This translated into an 8.54 per cent year-on-year growth in capital inflows’ contribution to GDP, reaching 3.76 per cent in Q1 2026,” it added. This influx of foreign portfolio investment aligned with intense activity in the Central Bank of Nigeria’s open market operations. “The CBN’s OMO auction recorded robust demand, with total subscriptions of N3.28tn versus an allotment of N3.04tn, reflecting sustained liquidity appetite for short-term, high-yield instruments,” the analysis revealed, adding that “demand was heavily concentrated in the 133-day paper, while stop rate averaged 20.99 per cent.” A similar trend played out in the sovereign debt market, where investors showed a strong preference for longer-dated maturities. “In the Treasury bills market, demand rebounded above the N2.00tn level to N2.16tn, up 8.64 per cent from the previous auction,” Meristem reported. “Investor appetite remained strongly skewed toward the long end, with the 364-day bill attracting N1.95tn of subscriptions,” it added. The report also highlighted major structural changes within the domestic financial landscape, notably the CBN’s recent final approval for Abbey Mortgage Bank Plc to transition into a full commercial bank, with operations set for Q4 2026. “The approval represents a regulatory licence upgrade supported by both strong financial performance and capital readiness,” the analysts stated, pointing to a shareholder-approved capital raise of about N264bn to meet tier-2 capital requirements. However, Meristem cautioned that entering the wider commercial banking space comes with fresh hurdles. “From a strategic standpoint, this transition shifts the bank from a specialised mortgage lender to a full-service financial institution. However, the move also introduces greater operational and financial risks, particularly around credit underwriting, liquidity management, and deposit mobilisation,” the firm noted. Looking forward, Meristem Securities expressed optimism that foreign portfolio inflows will maintain their momentum, provided policy consistency remains intact. “We expect the growth in FPI to be sustained, supported by macroeconomic stability, expected moderation in inflation, still attractive domestic yields, improved sovereign credit ratings, and credible FX policy execution,” the report concluded.