11 Banks Earn N6.5trn From Loans, Advances as CBN Increases Interest Rates For Access, UBA, Others
- Commercial banks in Nigeria have reported a rise in earnings from customers' loans and advances
- The report covered the first nine months of this year following the increase in interest rates by the Central Bank of Nigeria (CBN)
- Access Bank and 10 others generated about N6.5 trillion from customers’ loans and advances in nine months of 2024
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment, and the economy for over a decade.
Following the increase in the Monetary Policy Rate (MPR) by the Central Bank of Nigeria (CBN) and other African banks, commercial banks have declared massive revenues as Access Bank and 10 others generated about N6.5 trillion from customers’ loans and advances in nine months of 2024.
The amount represents a 118% increase from N2.99 trillion recorded in the same period in 2023.
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CBN adjusts interest rates
African central banks continued to adjust MPR to combat inflation, stabilize currencies, and address economic challenges.
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Nigeria’s central bank increased its MPR from 18.75% in December 2023 to 27.25% in September 2024.
Due to the spike in MPR, Nigerian banks and other African countries have seen a significant increase in customer loans and advances.
Access Bank leads with highest revenue from loans
Access Bank generated N1.13 trilion from loans and advances in the first nine months of 2024, representing a 146% increase from the N458.41 billion reported in the same period last year.
Also, Zenith Bank reported N1.07 trillion in revenue from customer loans and advances in nine months this year, representing a 163% increase over the N408.66 billion in the first nine months of 2023.
Ecobank declared N1.01 trillion in revenue from loans and advances in the first nine months of 2024, a 139.76% spike from N441.84 billion reported in the same period in 2024.
Also, the banks declared increased interest income and lending to other banks in the review period.
Results from audited banks
A breakdown of the banks’ audited results showed that they reported N12.68 trillion in interest income in nine months of 2024, a 145% increase from N5.18 trillion reported in 2023.
Lending to the real sector has risen in the period under review as the average maximum lending rate in the banking sector rose 30.21% in September 2024.
According to a ThisDay report, the maximum rate is the upper limit of interest rates for loans given to the sector, which might apply to higher-risk scenarios or different loan types.
The development comes as the CBN announced interest rates for the financial sector.
CBN mandates banks move to new FX trading platform
Legit.ng earlier reported that CBN issued a directive on Tuesday, November 26, 2024, mandating all banks in the interbank FX market to move to the Bloomberg BMatch system for forex trading.
The apex bank said the implementation will begin on December 2, 2024, and is designed to boost operational efficiency and transparency of Nigeria’s forex system.
In the circular seen by Legit.ng, CBN said the BMatch platform provides an automated system for matching trades, boosting market integrity, and facilitating better price discovery.
Proofreading by Nkem Ikeke, journalist and copy editor at Legit.ng.
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