Banking sector non-performing loans drop by 41% in 2019

Banking sector non-performing loans drop by 41% in 2019

The banking sector assets quality improved significantly in 2019 as non-performing loans (NPL) ratio nosedived by 41%.

This figure was captured by the Nigerian Bureau of Statistics (NBS). Analysts commend the figure, said it is a welcome development in the sector.

MarketForces recalled that deposit money banks had indicated interest in to carry cleaner assets as most of the big balance sheet engaged in balance sheet repairs in 2019.

The Bureau revealed that NPL in the Nigerian banking sector dropped from N1.79 trillion in 2018 to N1.05 trillion in 2019.

In its Selected Banking Sector Data for the fourth quarter of 2019, the bureau added that banks’ credit to the private sector increased by 4% in 2019.

NBS reported that credits to private sector increased from N15.13 trillion in 2018 to N17.19 trillion.

Meanwhile, credit allocated to the Oil and Gas sector declined by 4% from N3.55 trillion in 2018 to N3.42 trillion in 2019.

But Banks channeled more credit to the manufacturing sector, up by 18% from N2.23 trillion in 2018 to N2.62 trillion in 2019.

The bureau revealed that in terms of credit to the private sector, the total value of credit allocated by the bank stood at N17.19 trillion as of the fourth quarter of 2019.

Oil & Gas and Manufacturing sectors got credit allocation of N3.42 trillion and N2.62 trillion respectively, to record the highest credit allocation as of the period under review.”

In terms of staffing, the NBS said the number of bank staff reduced by 1% from 104,669 in 2018 to 103,610 in 2019.

On the other hand, number of contract staff increased by 0.25% in 2019 from 45,238 in 2018 to 45,350 in 2019.

Banking sector non-performing loans drop by 41% in 2019