Aggregate banking system credit (net) to the domestic economy in November 2011 rose by 3.5 per cent to N11.23tn, compared with 8.7 per cent in the preceding month.

According to the Central Bank of Nigeria’s economic report for the month of November, banking system’s credit (net) to the Federal Government, on month-on-month basis, grew by 12.7 per cent to negative N1.19tn, in contrast to the decline of 19.3 per cent at the end of the preceding month.

The development was attributed largely to the increase in banking system’s holding of Federal Government securities. 

The report said, “FG, however, remained a net lender to the banking system at the end of the review month. Banking system’s credit to the private sector rose by 1.7 per cent to N12.42tn, compared with 9.8 per cent recorded at end-October 2011.

“The development reflected, wholly, the rise in the Deposit Money Banks’ claims on the core private sector. Relative to the level at end-December 2010, banking system’s credit to the private sector rose by 26.3 per cent, compared with 24.2 per cent at end-October 2011.”

The report pointed out that growth in the major monetary aggregate was moderate at the end of the review month, saying that developments in money market rates were mixed. 

It added that the value of money market assets outstanding increased, owing largely to the rise in the value of FGN Bonds.

It said, “Provisional data indicated that growth in the major monetary aggregate was moderate at end-November 2011, relative to the level at the end of the preceding month. Broad money supply, which is also referred to as M2 increased to N12.21tn, by 0.3 per cent, in contrast to the decline of 3.5 per cent at the end of the preceding month. 

“The development was accounted for largely by the 3.5 per cent increase in domestic credit (net) of the banking system, which more than off-set the 1.5 and 4.5 per cent decline in foreign assets (net) and other assets (net) of the banking system, respectively.”

Gross federally-collected revenue, according to the report, in November 2011, was estimated at N989.74bn, showing an increase of 28.8 per cent over the monthly budget estimate, but was below the level in the preceding month by 13.5 per cent. At N777.97bn, gross oil receipts fell below the level in the preceding month. 

The report said it was attributed largely to the decline in receipts from oil and gas exports and domestic crude oil and gas sales.

Source: Punch/Ademola Alawiye