In 2020, the CBN issued guidelines to effectively monitor consistent loan defaulters and reduce NPLs.
According to the financial reports of four Nigerian banks, they all recorded non-performing loans (NPLs) totaling ₦478 billion during the first half of this year.
Guaranty Trust Bank Holding Plc (GTCO), FBN Holdings Plc, FCMB Group Plc, and Fidelity Bank Plc were the banks named. When compared to the ₦413.36 billion reported at the end of 2022, the NPL amount reflects a 16% rise.
GTCO’s H1 2023 NPL value was ₦115.29 billion, a 12.6% rise over the ₦102.37 billion reported in the 2022 fiscal year.
In its presentation to investors and analysts, GTCO said, “The Group’s IFRS 9 Stage 3 loans closed at 4.6% (Bank: 3.6%) in H1-2023 from 5.2% (Bank: 4.7%) in 2022. With Individuals and Others emerging as sectors with the highest NPLs i.e., 20.9% and 30.96% respectively.”
FBN, with about 4.3% NPL ratio and ₦5.26 trillion gross loans and advances in H1 2023, reported its NPL value as ₦226.24 billion indicating a 10.4% increase from ₦204.29 billion reported in 2022.
The holdings in its 2022 financial year declared a 5.4% NPL ratio and ₦3.79 trillion gross loans and advances
Fidelity Bank’s H1 2023 report also showed an NPL score of ₦84.73 billion from ₦61.37 billion reported in the same review period in 2022, while FCMB group declared ₦52.66 billion NPL value as of H1 2023 up from ₦45.01 billion during the same review period in 2022.
In order to reduce non-performing loans in the banking sector, the CBN issued the Global Standing Instruction (GSI) guideline in 2020, with the goal of efficiently monitoring consistent loan defaulters.
The central bank stated that the policy will allow banks to recover outstanding principle and interest from borrowers’ accounts at all financial institutions in the country if they fail to make payments.
