The total loans by Deposit Money Banks to the economy rose by N2.23tn between January and December 2019, data obtained from members of the Monetary Policy Committee of the Central Bank of Nigeria have revealed.
Also, during the period, the total deposits mobilised by banks from their customers rose by N2.34tn according to figures released by members of the MPC.
The figures were contained in the personal statements made by the MPC members during the last Monetary Policy Committee meeting held at the headquarters of the CBN on January 24.
The personnel statements were released on Wednesday by the Central Bank of Nigeria.
Members of the committee in their personal statements also put the Non-Performing Loan Portfolio of the banking industry at 6.1 per cent as at December 2019.
The NPL portfolio of 6.1 per cent in December represented a decline from the 11.3 per cent which it was in February, 2019.
The CBN Deputy Governor, Financial System Stability, Aisha Ahmad, in her personal statement said the financial system would emerge stronger in 2020, even as credit to the private sector continued to grow.
She said, “Capital adequacy, liquidity and other prudential ratios remain within desired levels, whilst the NPLs ratio in particular, reduced further to 6.1 per cent as at end December 2019, from 6.6 per cent at end-October 2019.”
The key challenge for the apex bank, according to her, would be to sustain this positive industry risk profile, notwithstanding continued growth in credit driven by the Loan to Deposit Ratio policy.
In his personal statement, another MPC member, Obadan Idiah, said the financial sector had continued to show good performance as portrayed by various financial soundness indicators.
He said the NPL has maintained its downward trend, standing at 6.1 per cent in December, 2019 compared to 11.3 per cent in February, 2019.
Idiah said the liquidity ratio stood at 45.6 per cent last December compared to the minimum requirement of 30 per cent.
He said the capital adequacy ratio of 14.5 per cent was good in relation to the prudential requirement of 10 per cent to 15 per cent.
These rates, he noted, were higher than those of comparator countries such as Turkey, South Africa and Malaysia.
He said, “The structure of total assets has also changed in favour of more loans and advances, and less of government securities. It shows that the impact of the loans to deposit ratio policy has been positive.
“The growth in total deposits has also been steady; total deposits recorded an increase of N2.34tn or 10.73 per cent between December 2018 and December 2019.
“Besides, aggregate credit growth has also been impressive; total credit increased by N2.23tn or by 14.54 per cent between December 2018 and December 2019.”
He said the growth in credit was largely due to the apex bank’s policy on LDR.
Some of the sectors that got the credit were manufacturing N446.44bn; general retail and consumer loans N419.02bn; general commerce N248.48bn; agriculture, forestry and fishing N160.94bn; information and communications N156.47bn.
Others were finance and insurance N129.87bn; construction N86.54bn; and transportation and storage N68.61bn.