CBN Reports Increased Recovery of N264.04 Billion in Development Financing

The Central Bank of Nigeria (CBN) has announced a significant recovery of N264.04 billion from borrowers in the first half of 2023 through its development financing programmes. This marks a notable increase of 27.4% compared to the N207.33 billion recovered in the same period last year, as revealed in the bank’s half-year economic report for 2023.

However, it has been observed that the figures provided by the CBN in its 2023 report contradict the earlier published data in the bank’s 2022 half-year report, which stated a recovery amount of N471.82 billion in the first half of 2022.

The CBN attributed the increased recovery to its reduced pace of intervention loans, which amounted to N331.33 billion in the first half of 2023. This reflects a 35.43% decrease compared to the N513.13 billion released in the same period of the previous year. The bank highlighted that 63 projects benefited from its financing programmes during this period.

The bank’s report stated:

“The Bank continued to intervene in the critical sectors of the economy. The Bank reduced the pace of its intervention in the critical segments of the economy, relative to the preceding and the corresponding periods of 2022. A total of 63 projects, including 134,275 individuals and businesses benefited from the Bank’s 13 intervention programmes, compared with 125 and 187 projects, including 279,211 and 134,275 individuals and businesses that benefited from its 20 and 19 programmes in the preceding and the corresponding periods of 2022, respectively. Cumulative disbursement declined by 35.4% to N331.33 billion below N513.13 billion in the preceding half of 2022, while the repayment increased by 27.4% to N264.04 billion above N207.33 billion in the same period. The increase in recovery reflected the drive for payments.”

The CBN’s development finance interventions primarily target critical sectors like agriculture, aiming to enhance access to credit, ensure price stability, and support job creation and economic recovery. However, the repayment process has posed challenges, leading to additional measures being taken by the bank. President Bola Tinubu reportedly instructed security agencies to aid the CBN in recovering funds, especially under the Anchor Borrowers Programme.

Moreover, the CBN has suspended new loan applications under its Intervention Programme, streamlining its financial commitments and shifting focus to more traditional central banking roles. Commercial banks, previously involved in distributing these intervention loans, are now tasked with recovering outstanding loans issued under these programmes.

Source: Nairametrics