The effects of the harmonisation of public sector CRR is beginning to take its toll as banks have begun sell of their bond assets in other to raise cash.

Analysts data suggest most banks hold a larger percentage of private sector funds when compared to public sector and as such an increase of private sector CRR from 20% to 31% is expected to result in a net cash outflow for most banks.

This is contrary to the views of some analysts who believed the harmonisation will lead to the banks having more cash to play with.

The yield on the benchmark bond maturing in 2024 inched up to 13.63 percent from 13.60 percent the previous day, while that on the 2022 paper rose to 13.59 percent from 13.51 percent.

Interest rates on short borrowing among banks eased, following the injection of portion of the budgetary allocations to states and local government in the banking system on Tuesday.

All of these point to a sell-off by banks as bond prices drop when there are more sellers thus pushing up yields.

The bond market according to Reuters saw market liquidity increase to around 235 billion naira ($1 billion) on Wednesdayfrom deficit level the previous day.

Secured Open Buy Back (OBB) eased to 7 percent, while overnight placement fell to 8 percent from 15 percent the previous day, traders said.