Banks slash loans to manufacturers by 26% to N8trn

By Babajide Komolafe

Banks’ lending to the manufacturing sector fell by 26 per cent, year-on-year, YoY to N8 trillion in February from N10.9 trillion in the same period of last year.

The Central Bank of Nigeria, CBN, disclosed this in its economic report for February 2025, which showed decline in banks’ lending to the manufacturing sector for two consecutive months.

According to the CBN, banks’ lending to the manufacturing sector fell Month-on-Month by 2.6  per cent to N8.309  trillion in January 2025 from N8.529 trillion in December,  and by 3.4 per cent, MoM to N3.029 trillion in February 2025.

Following the same trend, the share of the Manufacturing sector in total lending to the private sector fell to 13.9 per cent, representing a 3.8 percentage point decline from 17.7 per cent in February 2024.

Similarly, the share of the Manufacturing sector in total lending to the private sector fell by 0.3 percentage points from 14.2 percent in January 2025. 

Meanwhile, the CBN report showed a decline in lending to key sectors of the economy in February to N57.94 trillion. The report stated: “Total credit by Other Depository Corporation,  ODCs to key sectors of the economy decreased by 1.12 per cent to ¦ 57.94 trillion at end February, from ¦ 58.60 trillion at end-January 2025. The services sector recorded a 6.11 per cent decline in credit flow in the review period. 

“However, credit to the agriculture and industry sectors increased by 4.66 and 4.98 per cent, respectively, indicating sustained policy support for food security and industrial growth. In terms of sectoral distribution, the services sector maintained the largest share at 52.10 per cent, followed by industry (42.49%) and agriculture (5.41%).”

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