Ø Says total credit to Nigeria’s economy now N19.5tr
The Governor of Central Bank of Nigeria (CBN), Godwin Emefiele, railed-off against the parallel market in the country, alleging that it is a tainted market where illegal foreign exchange transactions, which include sourcing of forex cash for purposes of offering bribes and other corrupt activities, take place.
Emefiele, who disclosed this after the Monetary Policy Committee, (MPC) meeting on Tuesday, said aggregate domestic credit grew by 7.61 percent in October 2020, compared with 7.35 percent in the previous month.
While disclosing that the parallel market is no more than 5% of the forex market, the CBN governor said that Nigeria’s official exchange rate should not be determined by the rate in that market where the naira has weakened to a 3-month low.
Emefiele further said that the apex bank’s total credit to the economy rose to N19.54 trillion as of the end of November 13.
He attributed this to the bank’s policy on Loan-to-Deposit Ratio, (LDR), supported by its interventions in the various sectors of the economy. When compared with N15.56trillion at the commencement of the LDR policy in May 2019, total gross credit increased by N3.97trillion, he added. He said these loans were granted mainly to manufacturing (N738bn), general commerce (N874bn), agric. and forestry (N301bn), construction (N291bn), ICT (N231bn), just to mention a few.
Emefiele said the Committee noted the reduction in interest rates on loans granted by Deposit Money Banks, (DMBs) saying as of October 2020, 86.23 percent of total loans granted to over one million customers by the DMBs were at interest rates considerably below 20 percent. This, he said, was an improvement from 76.43 percent as at July 2019.
The apex bank boss said the Committee recognised the supportive developmental roles of the CBN towards addressing some of the structural issues in the economy”.
