CBN: Nigeria’s Banking System Safe, Stable

Emefiele Blames Nigerians Relocating Abroad For Naira Fall

The Central Bank of Nigeria (CBN), has expressed satisfaction with the country’s financial system, saying it is resilient, safe, and stable.

In a statement in which the apex bank made this known, it noted that the banking system continued to be resilient with major financial soundness indicators (FSIs) comparing favourably with the prudential thresholds as of the end of October 2022.

According to Governor Godwin Emefiele of the CBN, there was observed growth which was attributable to the substantial overshoot of domestic claims above programmed benchmark and importantly reflected the sustained growth of banking system credits to the private sector, consistent with the CBN policy to finance high-impact sectors.

“Despite rising private sector credits and elevated uncertainties, the banking system remained resilient and stable as NPL ratio (4.81 per cent), liquidity ratio (40.14 per cent) and CAR (13.39 per cent), outperformed their prudential limits. In order to insulate our economy from adverse external developments, it remains imperative to fortify our economic base by de-risking the productive sector and diversifying completely.

“This is especially as frozen oil receipt impedes the FX market, shrinking external reserves from $37.39bn in September to $36.87bn in October, and abetting exchange rate pressures,” the statement quoted Emefiele as saying.

Expert backs CBN on Banks’ resilience

Reacting to the statement, a member of the Monetary Policy Committee (MPC), Adeola Adenikinju said the various FSIs showed that the banking systems remained safe, sound, and resilient.

His words: “All measures of industry aggregates: assets, deposits and credit rose year on year. Total assets of the banking industry grew by N12.37tn between end-October 2021 and 2022.

“Similarly, industry credit increased by N5.32tn over the same period. In addition, total industry deposits rose by N6.92tn between end-October 2021 and 2022. In October 2022, a total of 125,305 new credits valued at N767.06bn were granted to various customers. There was marginal increase in lending rates in the industry in response to recent measures by the CBN.”

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