Credit to Government Down 0.9% to N40tn, Private Sector Lending Up 2.7%

Nume Ekeghe    

Credit to the government declined marginally in June 2026, while lending to the private sector extended its recovery for a second consecutive month, reflecting a gradual rebalancing of domestic credit in favour of businesses, according to the latest Money and Credit Statistics released by the Central Bank of Nigeria (CBN).

The data showed that total credit to the government fell by 0.9 per cent month-on-month to N40.03 trillion in June from N40.38 trillion recorded in May.

In contrast, credit to the private sector increased by 2.7 per cent to N83.26 trillion from N81.04 trillion in the preceding month, indicating renewed lending activity by deposit money banks despite the prevailing high interest rate environment.

The latest figures suggest that while government borrowing eased slightly during the month, banks expanded credit to businesses and households, a development analysts have consistently identified as critical to supporting economic growth and private sector investment.

A review of the CBN data showed that credit to the government has remained around the N40 trillion mark since the beginning of the second quarter after surging sharply in late 2025 and early 2026.

Government credit stood at N21.66 trillion in June 2025 before rising to N23.69 trillion in July, N24.16 trillion in September and N26.35 trillion in November. It accelerated significantly in December to N34.22 trillion, climbed further to N37.87 trillion in January and N39.36 trillion in February before moderating to N39.60 trillion in April. The figure edged up to N40.38 trillion in May before easing slightly to N40.03 trillion in June.

Private sector credit followed a different trajectory over the past year. Lending stood at N76.13 trillion in June 2025 and remained largely within the N72 trillion-N77 trillion range through the second half of last year. It moderated to N72.53 trillion in September before recovering to N75.83 trillion by December.

The series recorded a sharp jump at the beginning of 2026, rising to N93.74 trillion in January and N94.61 trillion in February. Lending subsequently moderated to N80.59 trillion in April before rebounding to N81.04 trillion in May and N83.26 trillion in June, marking two consecutive months of growth.