Aggregate credit to the economy rises to N18.6trn

AGGREGATE CREDIT CREDIT TO THE ECON OMY rose to N18.6tn as of the end of April 2020, according to latest reports released by the Central Bank of Nigeria.

A member of the Monetary Policy Committee, Kingsley Obiora, disclosed this in his presentation at the last MPC meeting of the CBN.

He said, “Financial system indicators were encouraging, with improvements to real sector lending, reflecting the bank’s Loan-to-Deposit Ratio policy.

“Total gross credit increased by N3.041tn from

N15.57tn at end-May 2019 to N18.6tn at end-April 2020.

“The credit growth was largely driven by manufacturing, consumer credit, general commerce, information and communication, and agriculture.

“The increase in credit is expected to bolster aggregate demand, investment, and job creation.”

Consequently, he added, the average retail lending rates of DMBs and interest rate spreads moderated in the review period.

“This development, I believe, will have a positive impact on financial intermediation and the effectiveness of monetary policy transmission channels,” he said.

However, there were risks and vulnerabilities in the short to medium-term, which included persisting new cases of coronavirus disease and low oil prices, he noted.

Although downside risks abound, he added that his overall outlook for the economy was more optimistic than most analysts seemed to portray.

He said, “I believe that while the economy will re