Banks’ non-performing loans rose by N50bn to N1.17tn as of the end of August from N1.12tn as of the end of June, the latest figures from the Central Bank of Nigeria and the National Bureau of Statistics have revealed.
The increase was attributed to the rise in total credit to the economy which rose from N18.9tn in June to N19.33tn as of the end of August.
The percentage of non-performing loans to the total credit, however, decreased from 6.4 per cent in June to 6.1 per cent in August.
According to figures from the NBS on selected banking data, the lending institutions’ non-performing loans stood at N1.12tn in June.
During the last Monetary Policy Committee meeting, the CBN Governor, Godwin Emefiele, said, “The committee also noted the decrease in the NPLs ratio to 6.1 per cent at end-August 2020 compared with 9.4 per cent in the corresponding period of 2019 due largely to recoveries, write offs and disposals.”
He said the committee expressed confidence in the overall stability of the banking system as reflected in the positive performance of the financial soundness indicators, despite the persistence of the COVID-19 pandemic.
The committee, he added, called on the CBN to sustain its regulatory oversight on the industry in the light of the continued fragility of macroeconomic indicators and the impact of the COVID-19 pandemic, and the growing risk of cyber-attacks on business and economic activities.
He said the bank’s policy on Loan to Deposit ratio also resulted in a significant growth in credit to various sectors from N15.57tn to N19.33tn between end-May 2019 and end-August 2020, an increase of N3.77tn.
