The Nigerian banking sector’s credit to the private sector rose by N4.1tn or 13.8 per cent between September 2020 and September this year.
The CBN’s money and credit statistics report showed that in September 2020, bank’s credit to the private sector stood at N29.7tn but rose to N33.8tn in September this year.
In October 2020, the sector’s debt to banks fell to N29.1tn, but climbed by N300bn to N29.4tn in November.
The total value of credit provided by banks to the sector rose to N30.4tn in December and N30.6tn in January 2021 but fell by N100bn in February to N30.5tn.
Lending to the private sector rose to N31.4tn in March, N31.9tn in April, N32.1tn in May and N32.6tn in June.
In a bid to drive lending to the real sector, the CBN had in 2019 directed all banks to maintain a minimum of 65 per cent Loans-to-Deposit Ratio by the end of December 2019.
The Deputy Governor, Economic Policy, CBN, Kingsley Obiora, also attributed the rise in credit to private sector to the LDR policy.
An economist and Senior Lecturer of Economics at the Pan Atlantic University, DrOlalekanAworinde, said while the rise in credit to the real sector was commendable, significant impact and growth in the sector would be reliant on how the funds provided were utilised.
The banking sector’s credit to the government rose from N9.6tn in September 2020 to 13.03tn in September 2021, according to the CBN.