The Central Bank of Nigeria’s most recent statistics show that between August 2021 and August 2022, the assets of Nigerian banks increased by N10 trillion, reaching N66.76 trillion.
The CBN stated that the banking industry maintained its resilience in the face of economic headwinds in Kingsley Obiora’s personal statement, a member of the Monetary Policy Committee.
It stated, “Despite these headwinds, the banking system remained sound, safe and resilient amid slowing economic growth. Total assets of the banking industry showed an increase of N10.72tn or 19.13 per cent from N56.04tn per cent in August 2021 to N66.76tn in August 2022, driven by balances with CBN/banks, investments, and credit expansion to the real sector.
“As a result, the total flow of credit to the economy increased from N22.62tn in August 2021 to N28.12tn, representing an increase of 24.3 per cent to the key sectors of the economy, including oil and gas, manufacturing, general, governments and commerce.”
Furthermore, he noted that lending to individuals and households increased from N1.85 trillion in Q2 2020 to N2.5 trillion in Q2 2022.
According to him, the industry’s non-performing loan ratio was 4.8% at the end of August 2022 as opposed to 6.0% at the end of August 2021, which was less than the prudential maximum of 5.0%.
Write-offs, facility restructuring, the Global Standing Instruction, and prudent credit risk management by banks are all responsible for the decrease in NPLs.
