PHOTO CREDITS: Boss Portal - South Sudan Banks Fight for Share of Treasury Cash
(JUBA) – South Sudan’s Central Bank attracted a rush of interest from local banks in its latest Treasury auction on 31 July 2025, with demand far exceeding the amount on offer. The Bank of South Sudan (BOSS) offered 20 billion South Sudanese Pounds (SSP), around 4.35 million US Dollars in government backed Treasury deposits, but received bids totalling over 122 billion SSP, equal to about 26.5 million US Dollars.
The auction was conducted through the Bank’s Treasury Deposit Facility (TDF), a tool used to mop up excess cash from the banking system. This helps reduce inflation and keeps prices stable by limiting how much money is circulating in the economy.
Only three of the eleven bids submitted were accepted. The rest, eight bids, were rejected, highlighting a high level of competition between banks for a limited supply of safe, short-term investment options.
Just five banks actually took part in the auction. These banks submitted multiple bids, but only a few of them met the Central Bank’s interest rate expectations. The winning bids averaged an interest rate of 2.33 percent, with the highest bid rate reaching 8.50 percent, and the lowest bid at 1.00 percent.
| Auction Summary (31 July 2025) | Figure |
|---|---|
| Amount Offered (SSP) | 20,000,000,000 |
| Amount Offered (USD Equivalent) | ~4.35 million USD |
| Total Bids Received (SSP) | 122,000,000,000 |
| Total Bids (USD Equivalent) | ~26.52 million USD |
| Number of Bids Submitted | 11 |
| Number of Successful Bids | 3 |
| Number of Participating Banks | 5 |
| Weighted Average Interest Rate (Winning Bids) | 2.33% |
| Highest Bid Rate Offered | 8.50% |
| Lowest Bid Rate Offered | 1.00% |
Why Such High Demand?
The scramble for Treasury deposits reflects how much cash is sitting in South Sudan’s banking system with nowhere to go. Because the private sector remains weak, banks have few options for lending. Loans to businesses are risky, and the returns can be uncertain. So, when the Central Bank offers safe, short term investment opportunities backed by the government, banks are quick to respond.
This month’s auction shows just how eager the banks are to park their excess funds in low risk instruments. BOSS only needed to collect 20 billion SSP, but banks offered over six times that amount. It is a clear sign of how tight competition has become in the local financial market.
At the same time, the high number of rejected bids suggests the Central Bank is being selective. It appears to be keeping interest rates low on these instruments in an effort to reduce inflation without overpaying for liquidity.
What This Means for South Sudan’s Economy
South Sudan’s economy continues to face serious challenges. The local currency remains under pressure, inflation is high, and access to hard currency is limited. By using tools like Treasury auctions, the Central Bank is trying to regain control over liquidity and guide inflation down.
Removing 20 billion SSP from the economy in one day reduces spending pressure and helps stabilise prices. It also signals that BOSS is committed to using market based tools, rather than just relying on currency controls or foreign aid.
However, analysts caution that while these actions are necessary, they are only part of the solution. Without stronger investment in the real economy such as agriculture, industry, and trade banks will continue to chase government securities rather than lend to businesses.
Transparency and Confidence Growing
The detailed public reporting of auction results, including interest rates and volumes, is a positive sign for financial transparency in South Sudan. Market players and investors are beginning to see clearer signals from the Central Bank about its monetary policy intentions.
Over time, regular and well managed Treasury operations can build trust in the local banking system. But the gap between demand and supply also highlights just how narrow South Sudan’s financial system still is.
With only five banks participating in this auction, there remains a need to expand access, improve competition, and deepen the financial sector.
More Treasury auctions are expected in the coming months as BOSS continues to fight inflation and absorb excess liquidity. If managed well, these operations could help create more stable conditions for broader economic reform.
But the question remains how the Central Bank can ensure that public money also finds its way into productive parts of the economy?
For now, it is clear banks in South Sudan are competing harder than ever for safe places to put their money.
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