Banks Record A Total Of N1.21tn Non-Performing Loans

Banks Record A Total Of N1.21tn Non-Performing Loans

Banks Record A Total Of N1.21tn Non-Performing Loans

Banks Record A Total Of N1.21tn Non-Performing Loans

According to data obtained from the Central Bank of Nigeria, the total amount of non-performing loans in the banking sector reached N1.21 trillion as of the end of February 2022.

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According to figures compiled by the CBN from the Monetary Policy Committee, total credit in the sector increased to N25.25 trillion by the end of February 2022 from N21.13 trillion at that time.

According to the report, the non-performing loans were a result of a case-by-case analysis of regulatory accommodation. And also the effect of the Global Standing Instructions policy, and good risk management practices in the industry.

A member of the MPC, Kingsley Obiora, said the banking system maintained its resilience amid economic recovery.

He said,

“Overall, the industry credit increased by 19.53 per cent to N25.25n in February 2022 from N21.13tn in February 2021. The industry NPL ratio continued to trend below the prudential threshold of five per cent.

“It decreased to 4.80 per cent at the end of February 2022 compared with 6.38 per cent in February 2021. The downward trend was attributable to recoveries, restructuring of facilities and sound management practices by DMBs (Deposit Money Banks).”

Banks Record A Total Of N1.21tn Non-Performing Loans

The Deputy Governor, Financial Systems Stability Directorate, CBN, Aishah Ahmad, said, “Total credit also increased by N4.13tn between end February 2021 and end-February 2022 with significant growth in credit to manufacturing, general commerce, and oil and gas sectors.”

She added that the non-performing loans ratio declined further to 4.8 percent in February 2022, from 4.94 percent in December 2021.

A member of the MPC, Robert Asogwa, said, the financial sector remained strong.  Which is similar to the position at the last MPC meeting. Especially looking at the banking and capital market developments.

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He said the banking sector appeared sound and resilient.  Having a considerably high Capital Adequacy Ratio and Liquidity Ratio in February 2022. which is n line with prudential requirements.

With a persistently lowering non-performing loan ratio since 2021. He said the asset quality of the banking system was now one of the strongest in Sub-Sahara Africa. Despite the shocks caused by the COVID-19 pandemic.

He said,

“Bank intermediation continued to improve in February 2022 with industry total credit increasing from N24.6tn in January 2022 to N25.25tn in February 2022.”

“The extension of the moratoria on bank loans up to the middle of 2022 as part of the COVID-19 relief measures continues to alleviate the burden on the borrowers impacted severely by the pandemic.”

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