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  • Business
  • Updated: April 20, 2022

Banking: N2.9 Trillion Lent To Customers In 2020, 2021 

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Felicia Abisola  Olamiji
Felicia Abisola Olamiji

  A graduate of English Language from Olabisi Onabanjo University, passionate about learning new...

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Stanbic IBTC, Fidelity Bank Plc, Sterling Bank, Wema Bank, First City Monument Bank, Access Bank Plc, Guaranty Trust Bank Plc, United Bank for Africa Plc, Zenith Bank Plc, and Union Bank Plc's combined loan portfolio rose by 2.9 trillion between December 2020 and December 2021

As of December 31, 2020, the loans and advances given to their customers was N14.64tn, which has increased to N17.63tn as of December 2021

According to their financial statements, all the reviewed banks increased their loan portfolios during the period.

The major proportion of the banks’ total assets which was giving out loans and advances to customers rose in 10 of the lenders. 

 In recent years, Nigerian banks’ loan books have grown on the back of the Central Bank of Nigeria’s push for more lending.

All commercial banks have been mandated by the CBN in July 2019 to maintain a minimum loan-to-deposit ratio of 60 percent by September 30, 2019, in a bid to improve lending to the real sector.

The minimum LDR was reviewed to 65 percent in October 2019.

Access Bank's financial report shows that its loans to customers rose from N3.22tn to N4.16tn from December 2020 to December 2021. 

UBA expanded its loan book to N2.8tn at the end of December 2021 to 2.55tn in December 2021

GTB increased its loan book to N1.80tn at the end of December 2021 from N1.66tn in December 2020 while that of Fidelity Bank rose to N1.65tn from N1.32tn. 

FCMB’s financial result shows that its loan to customers rose grew by N238bn from N822.7bn to N1.06tn during the period under review.

Stanbic IBTC’sfinancial results show that its loans to customers rose to N937.14bn from N625.14bn in December 2020, showing an increase of N312bn.

Furthermore, Union Bank recorded an increase of N175.5bn to N868.8bn from N692.80bn while Sterling Bank increased its loans and advances to customers to N1.06tn as of the end of 2021 from N596.83bn in December 2020.

Wema bank grew its loan book to N418.8bn in March from N360.08bn during the period under review.

According to Moody’s Investors Service, a global credit rating agency, in a report released in 2021, Nigerian banks’ loan quality would weaken during the year as coronavirus support measures implemented by the government and the central bank last year, including the loan repayment holiday, are unwound.

According to the report, the banks face higher asset quality risks as coronavirus support measures are withdrawn amid large single-name and sectoral concentrations and as banks hold a large volume of foreign currency loans.

However, in 2022, the agency changed its outlook for the Nigerian banking sector from negative to stable.

“We have changed our outlook for the Nigerian banking sector to stable from negative to reflect our expectations of stronger economic activity over the coming 18 months, which will boost banks’ business volumes and earnings, and help to protect their loan performance from further deterioration,” Assistant Vice President-Analyst at Moody’s, Peter Mushangwe said.

 

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Felicia Abisola  Olamiji
Felicia Abisola Olamiji

  A graduate of English Language from Olabisi Onabanjo University, passionate about learning new...

More From this Author

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