A new report indicated that commercial banks’ credits to the private sector rose by about N2.3 trillion between June and July 2024.
Latest data on credit to the private sector (CPS) obtained from the Central Bank of Nigeria (CBN) showed a 34 per cent increase from N56.46 trillion in July 2023 to N75.5 trillion in July 2024, representing an increase of about 34 per cent over the past one year.
The CPS represents banks’ loans, trade credits and other facilities to the private sector, which have increased significantly, indicating a resilience of the economy, according to experts.
The report showed that CPS rose by 33.7 per cent to N75.48 trillion in July 2024 as against N56.46 trillion recorded in July 2023, an increase of N19.02 trillion.
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A breakdown indicated that CPS increased by 3.1 per cent or N2.29 trillion to N75.48 trillion in July 2024 compared with N73.19 trillion in June 2024.
A report by the CBN had shown that Nigerian banks had seen significant increase in deposits during the first half of this year.
The report indicated that banks’ demand deposits rose from N26.7 trillion recorded at the end of December 2023 to N33.0 trillion by June 2024.
Earlier reports also indicated that banks have sustained steady growth in deposits across the quarters.
Total demand deposits in the first quarter ended March 2024 rose by 8.1 per cent to N28.9 trillion. In the second quarter ended June 2024, banks’ deposits increased by14.3 per cent to N33 trillion.
Banks’ operational reports had shown significant growths in deposits in 2023. For instance, audited reports for the year ended December 31, 2023 showed that Access Holdings’ deposits rose from N6.10 trillion in 2022 to N9.4 trillion in 2023. Zenith Bank grew deposits from N5.86 trillion to N11.43 trillion.
FBN Holdings recorded deposits of N7.85 trillion in 2023 as against N5.25 trillion in 2022. United Bank for Africa (UBA)’s deposits doubled from N4.83 trillion in 2022 to N9.32 trillion in 2023. Guaranty Trust Holding Company’s deposits increased from N3.47 trillion to N5.22 trillion.
Experts however say while the level of credits to the private sector showed the resilience of the economy, such credits show trickle down to all sectors of the economy.
CEO of SmallSmall, Tunde Balogun recently emphasised the huge credit gap in the Nigerian economy, calling for a more holistic approach in bridging the gap.
Dr. Muda Yusuf, an economist said small businesses must be prioritised in credit offering to boost the economy.
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