Banks credit to the government rose by N11.75tn in one year, figures obtained from the Central Bank of Nigeria have revealed.
The CBN disclosed in its ‘Money and credit statistics’ report that the credit rose from N14.9tn as of the end of January 2022 to N26.65tn in the corresponding period of 2023.
According to reports released by the CBN at the last Monetary Policy Committee meeting in January, a member of the committee, Aliyu Sanusi, said in his personal statement that the key drivers of the Net Domestic Asset was net claims on government which grew by 78.15 per cent in December 2022.
This in turn was driven by FGN’s borrowing from the Central Bank of Nigeria. Or
He said, “Developments in the monetary sector show that broad money (M3) growth increased to 17.72 per cent in December 2022 compared to 16.29 in November 2022, and has continued to be above the benchmark of 15.21 per cent for the year 2022. This increase was driven by Net Domestic Asset, which grew by 36.46 per cent (year-to-date) in December 2022.
“The key drivers of the NDA was net claims on government which grew by 78.15 per cent (y-t-d) in December 2022, which in turn was driven by FGN’s borrowing from the central bank (93.21 per cent), commercial banks (44.26 per cent) and non-interest banks (79.13 per cent).
“This suggests that monetary and fiscal factors have continued to play an important role in the current inflationary processes. Staff forecasts showed that headline inflation would increase from 21.09 per cent in October 2022 to 21.29 per cent in November 2022.”