Data obtained by our correspondent has shown that banks borrowed N595.34bn from the Central Bank of Nigeria between January and February.
The CBN’s monthly economic report showed that while N333.59bn was borrowed through the Standing Lending Facility in January, the amount was reduced to N255.75bn in February.
The apex bank said increased liquidity in the banking system caused a reduction in the amount borrowed by the lending institutions.
The report said, “Subdued activities in the SLF window and the strong patronage at the Standing Deposit Facility confirm increased liquidity in the banking system. Activities at the standing facility window reflected ease in banking system liquidity during the review period.
“The total SDF increased significantly by 60.79 percent, to N472.38bn, from N293.79bn in January 2022. Conversely, transactions at the SLF decreased by 24.69 percent, to N255.75bn, from N339.59bn in January 2022.”
A former President, of the Association of National Accountants of Nigeria, Dr. Sam Nzekwe, said banks borrow from the CBN as a lender of last resort.
According to him, the banks also keep part of their savings with the CBN.
He said, “The banks have to take from the CBN because it is the bank of the last resort. CBN is also keeping part of their money which they cannot lend.”
