Private Sector Loans Hits N12.213 trillion SaysCBN

The total value of banking sector credit to the private sector rose by 9.8 per cent to N12.213 trillion as at the end of October last year, the Central Bank of Nigeria (CBN) has said.

The amount represented an increase by N244 billion, compared with the N11.969 billion it stood the preceding month.

The apex bank, which disclosed this in its economic report for the month of October 2011, which was posted on its website yesterday, said the development “reflected wholly”, the rise in the Deposit Money Banks’ (DMBs’) claims on the core private sector.

It explained that in comparison with the level at end-December 2010, banking system’s credit to the private sector rose by 24.2 per cent, compared with 13.2 per cent at end-September 2011.

However, the report showed that aggregate banking sector credit to the domestic economy also increased 8.7 per cent to N10.848 trillion at end-October 2011, as against the N9.437 trillion, it stood as in the preceding month.

It said the development largely reflected the 9.8 per cent increase in claims on the core private sector. It added: “Banking system’s credit (net) to the federal government, on month-on-month basis, fell by 19.2 per cent to negative N1.365 trillion, compared with the decline of 25.9 per cent at the end of the preceding month.

“Over the level at end-December 2010, aggregate banking system’s claims on the federal government also fell by 21.7 per cent, reflecting, largely, the decline in the banking system’s holding of Federal Government securities. The federal government, however, remained a net lender to the banking system at the end of the review month.”

According to the regulator, quasi-money (assets that can be easily converted to cash), declined by 3.7 per cent to N6.374 trillion in the month under review, compared with 0.3 per cent at the end of the preceding month.

It also attributed the development to the fall in time, savings and foreign currency deposits of the DMBs. The CBN put the total value of currency in circulation, at the end of the month under review at N1.360 trillion.
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