The total assets and liabilities of the Deposit Money Banks in January amounted to N 24. 4tn, the Central Bank of Nigeria said in its latest report.

The figure, it noted, showed an increase of 0.3 per cent above the amount of the preceding month.

According to the CBN report, funds were sourced mainly from increased mobilisation of time, savings and foreign currency deposits; accretion to capital; and unclassified liabilities.

The funds were used, largely, for the acquisition of foreign assets, unclassified assets and the Federal Government securities, according to the monthly data.

The report, however, stated that banks’ credit to the domestic fell by 1.2 per cent during the period.

The CBN report read, “At N12.07tn, banks’ credit to the domestic economy fell by 1.2 per cent below the level in the preceding month. The development was attributed to the 1.2 per cent fall apiece in claims on the Federal Government and the private sector during the review month.

“Total specified liquid assets of the DMBs stood at N6.7tn, representing 40.1 per cent of their total current liabilities. At that level, the liquidity ratio rose by 0.5 percentage point above the level in the preceding month and was 10.1 percentage points above the stipulated minimum ratio of 30 per cent.”

“The loans -to-deposit ratio, at 37.5 per cent, was 0.1 and 42.5 percentage points below the levels at the end of the preceding month and the prescribed maximum ratio of 80.0 per cent, respectively,” it added.

The report also indicated the total amount of currency-in-circulation dropped by 10.6 per cent to N1.588tn in January.

This came on the heels of 13.1 per cent increase in amount of the currency-in-circulation as of December last year.

The latest development, the CBN report stated, reflected the 7.9 and 2.6 per cent decline in the currency outside banks and demand deposit components, respectively.

The report further stated, “Total deposits at the CBN amounted to N6.881tn, indicating a decline of 2.1 per cent below the level at the end of the preceding month.

“The development reflected the fall in the Federal Government’s deposit and deposit by ‘others’ which more than offset the increase in the DMBs’ deposit.

Of the total deposits, the percentage shares of the Federal Government, banks and “others” were 38.9, 55.5 and 5.6 per cent, respectively.

The CBN said that money market indicators were relatively stable during the review month, adding the monetary policy remained largely restrictive during the period in line with the monetary tightening stance of the bank.

The central bank recalled that the monetary policy rate was maintained at 12 per cent, while public sector Cash Reserve Ratio was raised from 50 to 75 per cent.

“In spite of the liquidity surge, which arose from maturing CBN bills, Asset Management Corporation of Nigeria bonds redemption and fiscal inflows during the review period, financial market indicators were relatively stable,” the report stated.

“Provisional data indicated that the value of money market’s assets outstanding at end-January 2014 was N6.968tn, indicating a decline of 1.9 per cent, in contrast to the increase of 9.4 per cent at the end of the preceding month. The development was attributed to the respective 2.1 and 1.6 per cent increase in FGN Bonds and NTBs outstanding at the end of the review period,” it added.

Source: Punch (by Oyetunji Abioye)