The Central Bank of Nigeria, CBN, disclosed this in its Depository Corporation survey report for February released last week. The report showed that credit to the economy grew by N1.9 trillion or 6.35 percent to N30.5 trillion in February from N28.64 trillion in January.
The report, however, showed that banks recorded 2.2 percent or N210 billion decline in current deposit which fell to N9.19 trillion in February from N9.4 trillion in January. “On domestic asset creation, the increase in NDA resulted from a m-o-m rise of 6.57 percent in Net Domestic Credit to N30.52 trillion, but was offset by a 0.04 percent m-o-m rise in Other Liabilities to N12.74 trillion.
“Reserve Money decreased m-o-m by 4.30 percent to N7.17 trillion as Bank reserves declined m-o-m by 8.47 percent to N4.58 trillion despite a 4.75 percent m-o-m rise in currency in circulation to N4.46 trillion.”Meanwhile the Debt Management Office will issue FGN bonds worth N100 billion with analysts projecting oversubscription and further reduction in the stop rate.
Recall the FGN bond auction held by DMO in March recorded 67 percent oversubscription. While the DMO offered N100 billion worth of bonds, investors’ demand or total subscription stood at N240.6 billion. In response to the huge demand, the DMO reduced the stop rates by 125 basis points from its previous auction levels down to 13.50 percent across all tenors offered.