Banks cut lending, opt for investment in securities

The loan books of Deposit Money Banks are shrinking by the day as lenders step up investments in securities and money market assets at the expense of lending.

Investigation by Punch correspondent revealed that the DMBs in the country, which before now were recording double-digit growth in their loan books year-on-year, were barely managing to hit nine per cent, with most banks recording around five per cent growth.

Top sources said the 18-month recession and weak growth recently witnessed by the country had affected the banking sector adversely; pointing out that most banks with high non-performing loans had reduced lending significantly.

They said unless the economic recovery became strong enough, banks might not be bullish in their lending activities in the coming months.

Punch, October 3, 2017

 

 

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