Commercial Bank Lending to Private Sector Rise to N26.8 Trillion – CBN

Data from the Central Bank of Nigeria has revealed that Nigerian banks’ credit to the private sector rose to N26.8 trillion as of June 2022 the highest on record.

Commercial banks also known as deposit money banks lent out a total of N26.8 trillion as of June 2022 up from the N24.378 trillion lent out to the private sector as of December 2021, representing a 10.15% growth in 6 months.

Deposit Money bank lending to the private sector was N21.89 trillion as of June 2021 thus adding N5 trillion in loan growth in one year.

Nigeria’s central bank has over the last 5 years pursued an aggressive policy of lending to the private sector, expecting that this will help spur economic growth in the real sector, while also creating jobs. Loans to the private sector were just N15.7 trillion as of December 2015 thus around N11 trillion has been added in under 7 years.

Click To Read: Nigeria’s Private Sector Experience Robust Expansion in December – Report

Further insight into the data reveals the Manufacturing sector has for the first time led the pack as the sector with the largest proportion of loans. Total loans to the manufacturing sector printed at N4.53 trillion or 16.9% of the total.

Lending to the manufacturing sector rose 23% year on year to N4.53 trillion representing 16.9% of total banking sector credit to the private sector.

It has now taken over from the downstream sector of oil and gas which posted total sector credit of N4.2 trillion or 16%. The general services sector was a distant third at 10% of total sector credit.

The fastest growing sector was the Agriculture sector has risen a whopping 41% year on year to N1.6 trillion. Loans to the trade sector also grew 39% to N1.9 trillion.

Loans to the power transmission and distribution sector however fell by 20%, the only sector that did not record growth.