The Central Bank of Nigeria (CBN) has revealed that credit to private sector has depreciated by 0.78 per cent to N22.44 trillion in March 2018 from N22.6 trillion reported in February.
The CBN in its Money and Credit Statistics report had disclosed N21.99 trillion credit to private sector in January.
Manufacturing sectors got credit allocation of N3.42trillion and N2.07trn to record the highest credit allocation within the period under review
The apex bank stated that credit to the government dropped by 10.84 per cent to N3.82 trillion in March from N4.29 trillion in February.
Analysts had explained that the increase in credit to the private sector was, in part, informed by recovering appetite for risk assets by commercial Banks in the face of relatively lower-yielding safe assets.
Speaking from the side of manufacturing sector, The President of the Manufacturers Association of Nigeria (MAN), Dr. Frank Jacobs, attributed the drop to CBN intervention.
He said, “CBN intervention has helped the manufacturing sector otherwise money deposit banks were not forthcoming in funding manufacturing sector in 2017.”
The report shows sustained increase in Broad Money, by 1.18per cent to N24.30 trillion in March 2018 from N24 trillion in February; as an 8.49 per cent increase in Net Foreign Assets (NFA) to N15.62 trillion from N14.4 trillion in February, more than offset a 9.76per cent decrease in Net Domestic Assets (NDA) to N8.68 trillion.
Growth in NFA was partly attributed to increase in oil dollar revenue (boosting external reserves) and further strengthened Nigeria’s position as a net lender to the rest of the world.
The apex bank disclosed that broad money rises to 17-year high of about N24 trillion in 2017.
On domestic asset creation, the decrease in NDA resulted from a 2.39per cent increase in Net Domestic Credit (NDC) to N26.27 trillion, accompanied by a 1.71per cent m-o-m increase in Other Liabilities (net) to N17.58 trillion in the month under review.
Further breakdown of the CBN report on NDC showed that share of NDC increased to 85.44percent from 84 percent), accompanied by a 10.84percent decrease in Credit to the Government to N3.82trillion.
The increase in credit to the Government was, in part, informed by lower borrowings in line with the federal government’s debt restructuring which favours longer maturing local and foreign debt, over short term debt. Month-on-month, Nigerian Treasury bills auctioned at the primary market fell by 32.40percent to N343.72 billion.
Hitherto, the National Bureau of Statistics (NBS), said, the total value of credit allocated by the banking sector stood at N15.60 trillion as at first quarter of 2018. “Oil & Gas and Manufacturing sectors got credit allocation of N3.42trillion and N2.07trn to record the highest credit allocation as at the period under review,” the report stated.