From N59.24tn at the end of December 2021 to N73.59tn in the same time of 2022, the total assets of the banking sector increased by N14.36tn or 24.24%.
This information was provided by the Central Bank of Nigeria in a personal statement given by Aishah Ahmad, Deputy Governor of the Financial System Stability Directorate of the CBN, at the most recent meeting of the Monetary Policy Committee.
The overall assets of key industry aggregates increased year over year, from N59.24 trillion in December 2021 to N73.59 trillion in December 2022, while total deposits increased by the same amount, from N38.42 trillion to N45.50 trillion.
“Total credit also increased by N5.14tn between end December 2021 and end-December 2022 with significant growth in credit to manufacturing, general commerce and oil & gas sectors. This impressive increase was achieved amid continued decline in non-performing loans ratio from 4.90 per cent in December 2021 to 4.20 per cent in December 2022.”
According to her, the financial system had provided significant support for needed domestic economic resilience amid global shocks and remained strong into 2023.
Data provided by Bank staff, she said, indicated stability in broad soundness indicators and an unprecedented improvement in asset quality, even as credit to the private sector continued to grow.
She noted that the capital adequacy as of December 2022 was robust at 13.83 per cent, 383 basis points above the regulatory minimum of 10 per cent.
Industry liquidity was also strong at 44.10 per cent over the same period and supported by significant cash reserve requirement buffers available to provide liquidity backstops, should banks require it, she noted.
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Ahmad said, “The sector also benefitted from ingenious initiatives such as the naira redesign and revised cash withdrawal limit policies, all expected to strengthen the banking channel of monetary policy transmission.
“Furthermore, results of stress tests showed resilience of banks’ solvency and liquidity ratios in response to potential severe macroeconomic shocks.
“However, the bank must remain vigilant to proactively manage probable macro risks to the financial system arising from spillover effects of global headwinds and domestic vulnerabilities, in view of the financial system’s strategic role in driving sustainable economic recovery.”
According to her, the economy had continued on a path of positive growth for eight consecutive quarters, driven largely by support from the Bank and the fiscal authority to output enhancing sectors.
Based on data from the National Bureau of Statistics, she said, Real Gross Domestic Product grew by 2.25 per cent (year-on-year) in the third quarter of 2022, compared with 3.54 per cent in the second quarter of 2022 and 4.03 per cent in the corresponding period of 2021.
Staff projections indicated that output growth recovery was expected to continue reasonably into 2023, given the expected sustained positive performance during the fourth quarter of 2022 and steady rebound in economic activities, she said.
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