The Central Bank of Nigeria (CBN) has slashed its net loans and receivables by over ₦4.1 trillion in 2024, driven largely by a sharp reduction in overdrafts to the Federal Government under the Ways and Means facility.
According to the apex bank’s audited financial statements, net loans at the bank level fell from ₦16.12tn in 2023 to ₦11.98tn in 2024, a decline of ₦4.15tn. At the group level, the figure dropped from ₦15.09tn to ₦10.96tn, marking a reduction of ₦4.13tn.
Major Cuts to FG Overdrafts
The biggest adjustment came from the CBN’s Ways and Means advances to the Federal Government. The overdraft balance fell from ₦7.95tn in 2023 to ₦3.27tn in 2024—a steep 58.9% drop (₦4.68tn).
This aligns with reforms introduced by CBN Governor Yemi Cardoso, aimed at reducing the apex bank’s exposure to fiscal dominance. The securitisation of ₦22.7tn in overdrafts in 2023 converted short-term liabilities into long-term debt, helping to ease inflationary pressures and restore monetary stability.
Reports also indicate the Federal Government has repaid ₦7.3tn of the restructured debt, reinforcing its commitment to reducing reliance on CBN financing.
Drop in Intervention Loans and Boost in Recoveries
The CBN recovered ₦253bn in 2024 from its various intervention loan programmes, including the Anchor Borrowers’ Programme, Real Sector Support Facility, and Commercial Agricultural Credit Scheme.
- Anchor Borrowers’ Programme: Repayments totaled ₦113bn, with outstanding balances dropping from ₦425bn to ₦312bn (group level).
- Commercial Agricultural Credit Scheme: Dropped by ₦43.3bn, to ₦58.5bn.
- Real Sector Support Facility: Fell by ₦37.5bn, to ₦60.7bn.
- BOI Debentures: Reduced by ₦9.9bn.
- Non-Oil Export Facility: Dropped by ₦5.86bn.
Governor Cardoso had previously criticized these interventionist programmes, estimating that they had disbursed over ₦10tn in the past, with questionable outcomes. He described them as distracting and distortionary to monetary policy and stated that the bank would focus on recovery and monitoring of existing programmes rather than launching new ones.
Other Key Changes
- The CBN’s Standing Lending Facility rose significantly from ₦29.4bn in 2023 to ₦386.9bn in 2024, indicating increased short-term liquidity support to banks.
- Long-term loans rose by ₦712.7bn, from ₦2.01tn to ₦2.72tn.
- AMCON notes increased from ₦3.90tn to ₦4.14tn.
- “Other Loans” dipped slightly by ₦8.7bn at group level, from ₦539.4bn to ₦530.7bn.
- Staff loans rose to ₦65.6bn at the group level.
Notably, the CBN fully cleared Promissory Notes worth ₦23bn and the ₦802.9bn NESI Stabilisation Strategy Limited Debenture. The NESI loan balance also dropped by ₦8.46bn to ₦368.4bn.
Gross loans at the group level declined by ₦3.62tn to ₦12.77tn, while the bank-level gross loan figure dropped from ₦17.42tn to ₦13.78tn. The allowance for Expected Credit Losses rose from ₦1.3tn to ₦1.8tn, indicating tighter credit risk standards and provisioning discipline.
Debate Over Intervention Programmes
While supporters argue the intervention programmes shielded key sectors during fiscal stress, critics say poor monitoring and weak recovery mechanisms rendered them unsustainable. Cardoso has made it clear that the CBN will no longer serve as a fiscal agent, vowing instead to restore monetary discipline and stability.
Repayments and recoveries are still ongoing, even though new applications under these schemes have been halted. The 2024 financial statement underscores a broader policy pivot aimed at tightening fiscal-monetary coordination and boosting the credibility of the central bank.
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