This picture taken on January 29, 2016 in Lagos shows 1000 naira banknotes, Nigeria’s currency. Nigeria’s central bank governor, Godwin Emefiele, on January 26 dismissed calls to devalue the naira in his monetary policy committee statement. Instead he chose to continue propping up the currency at 197-199 naira to the dollar and maintain foreign-exchange restrictions. As a result, the naira on the black market is hovering around a record low of 305, fuelling complaints from domestic and foreign businesses who can’t access dollars required for imports. / AFP / PIUS UTOMI EKPEI (Photo credit should read PIUS UTOMI EKPEI/AFP/Getty Images)

Bank Deposits Rise By 19% 

The Central Bank of Nigeria Monetary Policy Committee has said in a statement that deposits by Nigerian banks rose by N6.92 trillion.

This is from N36.13 trillion as of the end of October 2021 to N43.05 trillion in the corresponding period of 2022.

The Deputy Governor, Financial System Stability Directorate, CBN, Aishah Ahmad, said, “Notably, total assets rose to N69.67tn in October 2022 from N57.3tn in October 2021, while total deposits rose to N43.05tn from N36.13tn over the same period. Total credit also increased by N5.32tn to N28.81tn between end-October 2021 and end-October 2022 with significant growth in credit to manufacturing, general commerce, and oil & gas sectors.

“The continued credit expansion particularly to output-enhancing sectors is expected to further support economic activities. However, sustained regulatory vigilance is required to mitigate any potential crystallisation of credit risk in the financial system in view of lingering macroeconomic risks.

“As anticipated, average lending rates have risen between June and October 2022, partly driven by the tight monetary policy stance of the MPC, which requires vigilance by the banks to forestall defaults and preserve asset quality.”

She said sustained implementation of the policy on GSI and effective credit risk management policies by the banks was useful in that regard, while recent initiatives of the Central Bank such as the naira redesign were expected to enhance monetary policy transmission via the banking system.

However, with strong financial system fundamentals and satisfactory stress test results, she said, the Bank must remain vigilant and proactively manage operational, asset quality and other risks to financial system stability, especially with the challenging global economic environment.

Kehinde Ogunyale

Reporting on the data-driven economy, and investigations.

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