Banks’ loans to the economy appeared to have stunted in 2015 after a two-year recovery and growth. Total loans as at end of 2015 was N13.1 trillion, up by a paltry 1.5 per cent against N12.9 trillion in the preceding year, reports Vanguard.
Banks’ lending to the economy had grown by about 30 per cent and 26 per cent in 2013 and 2014 respectively. However, the development in credit growth appears to be a direct consequence of equally sluggish growth in deposit volume as total deposits in banks was N17.2 trillion, up by mere 1.8 per cent. Deposits had grown by 11 per cent and 10 per cent respectively in 2013 and 2014.
These developments appear to be a clear indication of the economic headwinds the banks had to contend with in the 2015 financial year. A further analysis of the banks’ loan and deposit report by the National Bureau of Statistics, NBS, points to the size of states’ economy and distribution of wealth across the geographical spread of the country which indicated that Lagos State dominated both bank credits and cash deposit portfolios of its residents and businesses with over N10.1 trillion in bank loans, about 78 per cent of the nation-wide loan resources and their bank deposits at N8.7 trillion also showing a predominant position at 50.6 per cent of the total.
Rivers State came second in both profiles with total bank loans at N658.3 billion, or 5.0 per cent of total while its bank deposits at N1.0 trillion was about 5.8 per cent of the country total. Adding to these two states in the top five borrowing states are Kano, Delta and Kaduna with N185.1 billion, N160 billion and N151.9 billion respectively. However, Kano and Kaduna lost their top five positions when it comes to cash deposits in banks as Delta, Oyo and Anambra with N464.3 billion, N388 billion and N371.1 billion respectively came into the top bracket. Yobe State was at the bottom of the profile with both the least bank loans and cash deposits in banks at N4.1 billion and N23.3 billion respectively.
Posted by Janice Johnson
