Banks’ borrowings from the Central Bank of Nigeria (CBN) under the Standing Lending Facility (SLF) has surged by 458.2 percent year-on-year to N57.5 trillion in the first half of 2024, up from N10.25 trillion recorded in the same period of 2023.
Data from the CBN also showed that banks’ deposits in the apex bank’s Standing Deposit Facility, SDF, grew YoY by 62 percent to N7.94 trillion during the same period from N2.99 trillion in H1’23.
Banks make use of the SLF window to access liquidity to run their operations while the Standing Deposit Facility window (SDF) on the other hand, is an overnight deposit facility that allows banks to lodge excess liquidity (money) with the CBN and earn interest.
The CBN data showed that banks/discount houses opening balance as of June 28th, 2024, stood at N309.97 billion. This represents a 73.3 percent decline when compared with N1.16 trillion as of June 30th, 2023.
The development is coming at a time the CBN is tightening monetary policy and also when banks are executing their recapitalization programe.
However, analysts have projected more tactical positioning as banks provide new information on their capital raise plans.
