Nigerian Banks Turn to CBN for Risk-Free Returns, Deposits Reach N58 Trillion
Nigerian banks are increasingly depositing excess liquid funds with the Central Bank of Nigeria (CBN) to earn risk-free returns, resulting in a significant increase in total deposits to N58 trillion. The recent adjustment in the CBN's corridor incentives has made overnight deposits more attractive, prompting banks to opt for safer investments.
Despite a lower Monetary Policy Rate (MPR), banks are still net depositors with the CBN's Standing Deposit Facility (SDF) rate remaining attractive. This trend highlights the banking sector's appetite for safer high-yield placements amidst lingering macroeconomic uncertainties.
Nigerian Treasury Bill yields have also seen an uptick, reflecting sustained bullish sentiment and strong investor demand in the secondary market.
Plus234Feed summary based on reporting from This Day. Read the original report below.
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