• Côte d’Ivoire raises 110bn CFA francs, meeting full target

• Investor demand hits 291bn CFA francs, nearly threefold oversubscribed

• Strong demand driven by banks favoring short-term Treasury bills

Côte d’Ivoire raised 110 billion CFA francs ($193 million) on the West African Economic and Monetary Union (WAEMU) market on Tuesday, meeting its target in full.

Investor demand reached 291 billion CFA francs, nearly three times the amount on offer.

Like other countries in the franc zone, Côte d’Ivoire regularly taps regional markets to finance public spending, including infrastructure, civil service wages and debt repayments. These auctions are organised by Dakar-based UMOA-Titres, which links member states with investors.

At Tuesday’s auction, the Ivorian Treasury issued three instruments: 364-day Treasury bills, along with three-year and five-year bonds.

The operation continues a sustained issuance trend. Following another 110 billion CFA franc raise on Monday, Côte d’Ivoire has mobilised more than 1,800 billion CFA francs since the start of the year through the UMOA-Titres market alone.

The pace reflects strong financing needs driven by new budget projects and the refinancing of maturing debt. Côte d’Ivoire is the most active issuer in the region so far this year.

Why investors favoured short-term debt

Demand was heavily concentrated on one-year bills. Of the 291 billion CFA francs in bids, 245 billion targeted this maturity.

Ivorian and regional banks were the main participants, supported by abundant liquidity and a preference for low-risk, yield-bearing assets such as Treasury bills.

The Treasury accepted only 64 billion CFA francs of these bids, about a quarter of the total, as it rejected offers considered too costly.

The average yield on one-year bills stood at 5.32%, down 80 basis points from 6.12% in January.

Lower borrowing costs support public finances, but the decline largely reflects excess liquidity in the banking system, linked to the regional central bank (BCEAO). Analysts warn that a shift in this environment, particularly if geopolitical tensions reignite inflation, could quickly tighten financing conditions.

Yields on longer-term instruments remain higher, at 6.96% for three-year bonds and 7.22% for five-year bonds. Demand for these maturities was weaker, and the Treasury accepted all bids, leaving little room for selectivity.

A market dominated by local investors

Funding came mainly from domestic investors. Ivorian participants accounted for the bulk of allocations, with smaller contributions from Senegal and Burkina Faso. Benin submitted bids but received no allocation as its offers were too costly.

This reliance on local investors is a structural feature of the regional market and could expose the state to financing risks if the domestic banking sector comes under pressure.

The 110 billion CFA franc issuance compares with 103.6 billion CFA francs in debt repayments due this March.

Given the narrow gap, the operation primarily reflects debt refinancing rather than funding for new spending, a process known as a rollover.

Fiacre E. Kakpo