FRI APRIL 17 2026-theGBJournal| The Central Bank of Nigeria (CBN), has launched a new overnight risk‑free interest rate benchmark, the Nigerian Overnight Financing Rate (NOFR) that it says, reflects the cost of overnight secured funding in the Nigerian interbank market and is based on actual market transactions, not estimates.
The new benchmark is launched in collaboration with the Financial Markets Dealers Association (FMDA), today.
The CBN said the standardized benchmark is aimed at enhancing transparency, strengthening monetary policy transmission, and deepening Nigeria’s money market.
NOFR was developed to align Nigeria with global best practices in short-term interest rate benchmarks.
It is expected to improve price discovery and transparency while promoting consistent pricing of money market instruments. It will enhance the effectiveness of monetary policy, support financial innovation, boost investor confidence, and strengthen risk management across the financial system.
The introduction of NOFR positions Nigeria alongside leading global benchmarks such as SOFR (United States), SONIA (United Kingdom), €STR (Eurozone), and TONA
(Japan). It also complements African benchmarks such as JIBAR (South Africa).
Following a stakeholder engagement session held on February 27, 2026, where market participants formally adopted the benchmark, and subsequent regulatory
approval, NOFR is now in use, with the CBN serving as the benchmark administrator.
The apex said it will ensure governance, transparency, and regular publication of the rate.
The NOFR is administered and published by the Central Bank of Nigeria (CBN), and is published daily at 10:00 a.m. Lagos time on the business day following the fixing day.
Transactions are eligible for NOFR calculation are NGN‑denominated overnight secured repo transactions executed on the fixing day, reported by eligible banks, and with a minimum size of N5 billion.
The CBN explains that the NOFR is calculated as a volume‑weighted trimmed mean. The lowest 10 percent and highest 10 percent of transaction volumes are excluded, and the remaining rates are averaged.
Where eligible transaction data is insufficient, NOFR equals the previous business day’s rate and this outcome is clearly disclosed at publication
According to the CBN, Certain corporate, structured, or syndicated loans may reference NOFR directly or indirectly.
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