NEWSONLINE reports that the maximum lending rate for Nigerian banks rose to 29.13% in December 2022 from 28.14% recorded in the previous month and 27.58% in the corresponding period of 2021.
This online newspaper understands that bank lending rates increased on the back of the multiple rate hikes by the Central Bank of Nigeria in 2022. Specifically, the CBN raised the benchmark interest rate by a collective 500 basis points to 16.5%, representing its highest rate in 21 years.
According to the money and credit statistics seen by NEWSONLINE NIGERIA from the Central Bank of Nigeria, the maximum lending rate averaged 28.09% in 2022 compared to 28.06% recorded in the previous year. Meanwhile, the prime lending rate stood at 13.85% from 13.17% recorded in the preceding month.
Credit still on the rise: Despite the interest rate increase, Nigeria’s private sector’s credit rose by N6.61 trillion in 2022 to close the year at N41.8 trillion, the highest on record.
Banks set to earn big: Banks and lenders stand to gain from the high-interest rate environment adopted by the CBN.
Bottom line: NEWSONLINE reported how the CBN raised the interest rate in 2022 to discourage more borrowing to reduce liquidity in the economy, which is believed to be contributing to the rising rate of inflation. However, credit still rose in the review year, an indication that credit still found its way into the economy despite high-interest rates.
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