Connect with us

Business

Fifty customers account for 33.4% of loans from banks

Published

on

Spread The News

About 33.4 per cent of the total private sector credit exposure of N15.68 trillion were being owed by fifty customers alone to the bank, National Daily investigation has gathered.

According to the Central Bank of Nigeria’s Financial System Stability report, the total debt is put at about N5.23 trillion

The FSS report, posted on the CBN website on Saturday, also showed that the nation’s banks gave N1.537tn loans to oil companies and some state governments in the first six months of the year.

The 81-page FSS report stated in part, “Credit exposure to the dominant sectors is as follows: 28.77 per cent to oil and gas sector; 12.95 per cent to manufacturing; 8.84 per cent to governments; and 8.69 per cent to general commerce.

The report stated, “At end-June 2016, loans to the oil and gas sector constituted 28.77 per cent of the gross loan portfolio of the banking  system as credit to that sector grew to N4.511tn, compared with N3.307tn at end-December 2015. Loans to state governments rose to N1, 386.61bn from N1, 053.97bn at end-December 2015, as declining revenues continued to constrain payment of salary by some states, funding of key services and execution of developmental projects.

“This was despite the CBN’s N338bn special intervention scheme designed to refinance states’ debts, as well as a debt restructuring programme introduced by the Debt Management Office, which enabled states to restructure their commercial loans in the preceding period.  However, to prevent further financial crisis, a fresh facility of N90bn with a nine per cent interest rate was made available to the states.”

According to the CBN, the biting economic recession has made the market share of the five biggest commercial banks in the country in terms of total assets to decline by 17.3 per cent in six months.

Economic and financial experts said the challenging economic situation had led to muted low growth in the banking industry with most banks scaling down drastically on their lending activities.

Most banks, they added, were now being preoccupied with how to clean up their books by recovering some of the huge NPLs in their books.

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published.

Trending