The amount of loans issued to the private sector by the banking industry has increased by 3.14 per cent within one month from N41.754 trillion in February this year to N43.066 trillion at the end of March.
This is as net credit to the government declined by 3.17 per cent from N28.431 trillion in February to N27.529 trillion at the end of March 2023.
Banks had begun to increase lending to the private sector as the effects of the cash crunch waned in the country, increasing the level of credit to the sector by 18.1 per cent compared to N36.47 trillion that was recorded at the end of March 2022.
Analysts at Cordros Research explained that the increase in the credit to the private sector “reflects the impact of improved domestic macroeconomic conditions and CBN-led interventions on the real sector.
“We expect that the improvement of domestic economic activities will drive the willingness of commercial banks to create risky assets.
“Also, we expect the CBN to maintain its intervention programmes at a steady pace as the economy expands.
“Conclusively, we predict that the Credit to Private Sector (CPS) will maintain a double-digit expansion in 2023 full year," the analysts said.
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