Nigeria’s Central Bank has announced that over one million bank customers took loans from their financial institutions in the last one year below 20% interest rate.
Deputy Governor, Financial Systems Stability of the central bank Aisha Ahmad said this during the in her statement at the last Monetary Policy Committee meeting. She said this was an improvement on data from previous years.
Ms Ahmad said: “The gradual decline reported in lending rates is a positive development that improves access to credit for more households and businesses with a view to stimulating economic activity, creating jobs and driving a more sustainable and inclusive growth. As at October 2020, 86.23% of total loans granted to over one million customers by Deposit Money Banks were at interest rates considerably below 20%; an improvement from 76.43% as at July 2019.”
Ms Ahmad asked financial institutions to be vigilant and ensure optimal liquidity levels to support price stability and sustainable economic growth.
She said the banking industry’s financial soundness indicators strengthened with non-performing loans ratio declining to 5.7% at end-October 2020, from 6.1% (end-August 2020), while capital adequacy improved to 15.5% from 15.3% over the same period.
Ms Ahmad said that profitability performance also remained satisfactory, buoyed by improvement in non-interest income.
“Financial sustainability of banks would be paramount as moratoriums on restructured loans lapse in the near term to strengthen absorptive capacity for any potential losses and maintain lending support to the real economy.”