Economy
Survey Reveals Increase in Credit in Q3
The third quarter (Q3) 2016 “Credit Conditions Survey Report” has revealed increase in secured and unsecured credit availability to households, small businesses and corporate entities, compared with the previous quarter.
The report by the Central Bank of Nigeria (CBN) also showed that spread on overall secured and unsecured lending to households widened in Q3, 2016 and was expected to remain widened in the next quarter.
It stated that lenders also reported that households’ demand for house purchase lending, unsecured credit card lending and unsecured overdraft/personal loans all increased in Q3, 2016 and were expected to increase in the next quarter.
According to the report, the demand for corporate lending in Q3, 2016 increased across all firm sizes and was expected to increase further in the next quarter. Corporate loans performance to all businesses deteriorated in Q3, 2016.
In addition, the report showed that in Q3 2016 relative to the previous quarter, lenders reported an increase in the availability of secured credit to households.
“Lenders noted that brighter economic outlook and changing appetite for risk were major factors behind the increase. The availability of secured credit was however expected to decrease in the next quarter with the banks’ “market share objectives” as the major contributory factor.
“Due to lenders stance on tightening the credit scoring criteria in Q3 2016 there was a decline in the proportion of loan applications approved in the quarter. Though lenders expect the credit scoring criteria to remain tightened in the next quarter, they expect the proportion of households’ loan applications approved in Q4 2016 to increase.
“Maximum Loan to Value (LTV) ratios remained flat in the current and next quarter.
Lenders expressed their unwillingness to lend at low LTV ratios (75% or less) in both the current and next quarters. Similarly, they expressed unwillingness to lend at high LTV (more than 75%) in the current quarter and the next quarter (Question 10). The average credit quality on new secured lending improved in Q3 2016 and was expected to improve further in Q4 2016.
“Lenders reported that the overall spreads on secured lending rates to households relative to MPR widened in Q3 2016 and was expected to further widen in the next quarter. Widened spreads were reported for prime, buy to let and other lending in Q3 2016 and were expected to widen further in the next quarter,” it added.
Households demand for lending for house purchase increased in Q3 2016 and was expected to further increase in the next quarter. Of the total demand, increase in households demand for prime, buy to let and other lending were reported, but were expected to decrease in the next quarter except demand for prime lending.
Households demand for consumer loans, mortgage/remortgaging and small businesses rose in Q3 2016 and were expected to rise further in Q4 2016. Secured loan performance, as measured by default rates worsened in Q3 2016 and but was expected to improve in Q4 2016. Loss given default deteriorated in the current quarter but was expected to improve in the next quarter.
Also, the availability of unsecured credit provided to households rose in the current quarter and was expected to further rise in the next quarter. Lenders reported increased appetite for risk and banks’ market share objectives as factors that contributed to the increase in Q3 2016.
Due to Lenders’ resolve to tighten the credit scoring criteria for total unsecured loan applications in Q3 2016, the proportion of approved total loan applications for households decreased in the quarter. Lenders expect to loosen the credit scoring criteria in the next quarter, but are still of the opinion that the total loans applications to be approved in Q4 2016 will further decrease.
Similarly, lenders tightened the credit scoring criteria for granting credit card loan applications and expect the proportion of approved credit card applications to decrease in Q4 2016.
Lenders resolve to tighten the credit scoring criteria in granting overdraft/personal loan applications in the current quarter decreased the proportion of approved household’s overdraft/personal loan applications in the current quarter.
Lenders reported that spreads on credit card lending widened in Q3 2016 and was expected to widen further in the next quarter. Similarly, it revealed that spreads on unsecured overdrafts/personal loans on approved new loan applications widened in the current quarter and was expected to widen further in the next quarter.
http://www.thisdaylive.com/index.php/2016/09/28/survey-reveals-increase-in-credit-in-third-quarter/
By Adedapo Adesanya
The Minister of Finance and Coordinating Minister of the Economy, Mr Taiwo Oyedele, said the removal of petrol subsidy saved Nigeria N15.8 trillion between June 2023 and December 2025.
Mr Oyedele disclosed this on Wednesday at a press conference, where he provided a breakdown of the financial impact of the federal government’s economic reforms under President Bola Tinubu, the same day that the campaign for the 2027 presidential elections commenced.
He said the subsidy savings were reflected in the resources available to the federation, although they did not appear as a separate credit to the federation account under the description “subsidy savings”.
“Between June 2023 and December 2025, subsidy savings mobilised the sum of N15.8 trillion in resources for the federation.
“Many people will say, where is the subsidy savings? As a matter of fact, there wasn’t any alert to the Federation Account with the description ‘subsidy savings’,” Mr Oyedele said.
According to the minister, the federal government received N5.4 trillion of the N15.8 trillion, while N10.4 trillion was shared among state and local governments through the Federation Account.
Mr Oyedele said the government’s overall financial position during the period also reflected increased independent revenue and borrowing to fund its expenditure.
He said the federal government generated N3.1 trillion in incremental independent revenue, largely from remittances by government-owned entities and increased surpluses from government agencies.
The government also borrowed an additional N11.9 trillion between June 2023 and December 2025.
“People will say, you said you have exceeded your revenue, why are you still borrowing?” Mr Oyedele said, “The additional borrowing that the federal government took for that period of time, June 2023 to December 2025, amounted to N11.9 trillion.”
According to him, the combination of incremental independent revenue and additional borrowing brought the Federal Government’s incremental resources during the period to N20.4 trillion.
However, he said total incremental expenditure stood at N30.64 trillion.
Mr Oyedele said the figures demonstrated the fiscal implications of the reforms, which were introduced to address long-standing economic distortions and reduce pressure on government finances.
“The administration of President Bola Tinubu has embarked on major reforms to address age-long economic challenges,” he said.
He identified the removal of petrol subsidy and the unification of the foreign exchange market as key measures undertaken by the administration.
“The removal of fuel subsidy, which was quietly bankrupting the country, and the unification of an exchange rate system that had become a source of distortion and corruption rather than stability.
“Those decisions came at a cost, and we are not here to implement otherwise. What does reform cost?” Mr Oyedele questioned.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange weakened further by 1.75 per cent on Tuesday, August 18, triggered by losses recorded by the duo of Central Securities Clearing System (CSCS) Plc and Food Concepts Plc.
CSCS Plc, the Nigerian securities depository company, lost N8.48 to settle at N90.02 per share compared with the previous value of N98.50 per share, while Food Concepts Plc, the parent company of fast food franchise, Chicken Republic, dropped 15 Kobo to end at N2.35 per unit versus N2.50 per unit.
Consequently, the NASD Security Index (NSI) further declined by 77.26 points to 4,348.76 points from Monday’s 4,426.02 points, while the market capitalisation dipped by N46.37 billion to N2.610 trillion from N2.656 trillion.
During the session, the volume of securities bought and sold by investors slumped by 82.6 per cent to 113,728 units from the previous session’s 652,081 units, and the value of securities slid by 12.4 per cent to N9.4 million from the preceding day’s N10.7 million, while the number of deals increased by 47.6 per cent to 31 deals from 21 deals.
Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis, with 3.4 billion units traded for N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 79.7 million units transacted for N5.8 billion.
GNI Plc was also the most traded stock by volume on a year-to-date basis, with 3.4 billion units valued at N8.4 billion, trailed by Infracredit Plc with 2.3 billion units worth N6.5 billion, and Resourcery Plc with 1.1 billion units exchanged for N415.7 million.
By Adedapo Adesanya
The value of the Nigerian Naira further appreciated against the US Dollar by N6.22 or 0.46 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Tuesday, August 18, to N1,343.32/$1 from the previous rate of N1,349.54/$1.
This occurred amid steady growth in Nigeria’s external reserves, rising to $52.32 billion as of August 17, 2026, giving the Central Bank of Nigeria (CBN) enough arsenal to defend the local currency when the need arises in the FX market.
Also, the domestic currency improved its value against the Pound Sterling in the official market yesterday by N10.85 to close at N1,819.26/£1 compared with the previous day’s N1,830.11/£1, and gained N8.55 on the Euro to sell at N1,556.24/€1 versus Monday’s N1,564.79/€1.
In the same vein, the Naira appreciated against the Dollar in the black market during the trading session by N5 to quote at N1,390/$1, in contrast to the N1,395/$1 it was traded a day earlier, and strengthened at the GTBank forex desk by N7 to N1,357/$1 from N1,364/$1.
NAFEM interbank FX turnover declined as financial institutions’ activities moderated. Interbank FX turnover dropped by 16.6 per cent to $364.709 million from $437.529 million, with the number of deals down by 39.3 per cent to 108 deals from 178 deals.
As for the cryptocurrency market, Bitcoin (BTC) traded at $64,120.36, as most other major cryptocurrencies closed in the green amid a global selloff in chip stocks.
An Asian semiconductor gauge dropped more than 3 per cent, following a 5 per cent slide in the Philadelphia Semiconductor Index on Tuesday, its worst session since late July, while investors await US Federal Reserve minutes and are widely expecting no rate change in September.
Solana (SOL) gained 1.4 per cent to sell at $76.66, Cardano (ADA) added 0.9 per cent to trade at $0.1748, Ethereum (ETH) grew by 0.6 per cent to $1,905.54, Ripple (XRP) appreciated by 0.4 per cent to sell at $0.9986, TRON (TRX) improved by 0.3 per cent to $0.3327, and Dogecoin (DOGE) soared by 0.2 per cent to $0.0698.
However, Binance Coin (BNB) depreciated by 0.4 per cent to $600.88, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
