The water was the body of the (Rishi) Nara and we hear it called Nara; and because it formed his resting place he is called Narayana.
आपो नारास्तत्तनव इत्यपां नाम शुश्रुम। अयनं तेन चैवास्ते तेन नारायणः स्मृतः॥