Credit to Nigeria’s private sector climbed to N84.55 trillion ($63.22 billion) in August, recording three consecutive months of steady growth as economic activity gradually gathers momentum.
According to the latest data from the Central Bank of Nigeria, this upward trend follows a volatile dip earlier in the year across financial markets.
The credit expansion reflects shifting liquidity dynamics as commercial banks navigate high borrowing costs, ongoing recapitalization mandates, and monetary policy tightening.
The recovery unfolds alongside a significant strengthening of foreign exchange reserves, which recently crossed the $53 billion milestone to reach multi-year highs.
This credit growth also builds upon a volatile first half of the year, recovering sharply from a low of N80.5 trillion recorded in April.
Subsequent expansions in May at N81.04 trillion and June at N83.2 trillion provided a foundational recovery before July bridged toward the August peak.
Despite a restrictive Monetary Policy Rate (26.5%) designed to tame inflation, private sector demand for working capital and commercial paper issuances remained resilient.
Governor Olayemi Cardoso’s orthodox monetary strategy has helped stabilize the naira and improve market confidence through reformed money market operations.
However, credit expansion, remains unevenly distributed across the economy, with the services sector and trade traditionally capturing the largest share of commercial bank credit.
Capital-intensive industries like manufacturing and oil and gas continue to secure major credit lines, though banks apply tighter scrutiny amid ongoing recapitalization mandates.
Meanwhile, sectors like real estate, construction, and infrastructure increasingly rely on commercial paper issuances and targeted corporate financing to navigate high borrowing costs.
Strategic adjustments, including lifted Discount Window restrictions and renewed tenored repo operations, have further supported banking sector liquidity and credit delivery.
