Nigerian Breweries PLC Commercial paper (CP) Matures Today, December 30, 2015. The Commercial paper with 82-day life which was issued on October 15th and listed with FMDQ in an elaborate quotation ceremony on November 12th was to support the Issuer’s short term funding requirements of the issuer.
With its maturity, the Nigeria market now has only one commercial paper, the Wema Bank PLC, Commercial paper outstanding. That too matures soon. One effect of this maturity is that it will increase system liquidity which in turn may depress interest rates further.
Commercial paper (CP) are short-term, promissory notes issued primarily by corporations. Maturities range up to 270 days but average about 30 days. Many companies use CP to raise cash needed for current transactions, and many find it to be a lower-cost alternative to bank loans.
With the current low interest rate regime, it is surprising that companies are not taking advantage of it by accessing needed funding through commercial papers.