HomeBusinessLending rates dip as...

Lending rates dip as ETI, FBNH, 5 others generate


By Chinwendu Obienyi

With significant excess liquidity in the banking sector, its lending rate dropped to about 27.61 per cent in the first half (H1) of 2022, the lowest in five years.

This was even as 7 banks generated about N570 billion from interest income in loans in the period under review.

Data from the Central Bank of Nigeria (CBN) on banks’ deposit and lending interest rates in the first quarter (Q1) of 2022 showed a 1.04 per cent point drop in average lending rate to 26.61 per cent in March 2022 from 27.65 per cent in January.

The banks’ prime lending rate in the during the period rose by 12.29 per cent in June, the highest in 17-month, while the maximum lending rate dropped to 27.61 percent in June 2022 from 27.65 percent reported in January 2022.

Prime lending rate is the interest rate charged by banks to largest, secure and creditworthy customers on short-term loans while maximum lending rate refers to the aggregate percentage of prime lending rate.

The development saw seven of the top tier banks generate N570.43 billion in interest income from loans granted to customers in the period under review amidst hike in the Monetary Policy Rate (MPR).

This was in contrast to N457.95 billion granted to customers in H1 2021. With the exclusion of Sterling Bank Plc, other banks including Ecobank Transnational Incorporated (ETI), FBN Holdings Plc, FCMB Group Plc, Union Bank, Unity Bank Plc and Wema Bank Plc generated double-digit increase in interest income on loans granted to customers in the period under review.

Specifically, Sterling Bank Plc reported N47.04 billion interest income from loans to customers in H1 2022, representing an increase of 7.88 per cent from N43.61 billion in H1 2021. 

For ETI, interest income from loans to customers rose by 16.3 per cent to N168.7 billion in H1 2022 from N145.08 billion in H1 2021, while FBN Holdings announced 36 per cent rise to N166.32 billion as interest income generated from loans to customers in H1 2022 from N122.03 billion in H1 2021.

FCMB Group reported N78.75 billion in interest income from loans to customers in H1 2022, representing an increase of 25 per cent from N63.08 billion in H1 2021, while Union Bank  closed H1 2022 with N50.46 billion interest income from loans to customers as against N40.7 billion in H1 2021. 

Unity Bank reported N19.17billion interest income from loans to customers in H1 2022, representing an increase of 26 per cent from N15.15 billion in H1 2021, while Wema Bank generated a whopping sum of N39.97 billion from interest income from loans to customers in H1 2022 from N28.33 billion in H1 2021. 

Commenting on the development, the Vice President, Highcap Securities Limited, David Adnori, said most customers were only able to obtain loans at rates higher than the prime lending rate mostly because they are more likely to default on a loan. 

“An increase in the MPR by the MPC will result in an increase in the price (interest rate) you pay for borrowing and vice versa. Banks responded to this hike by jacking up their lending rate as well. The consequence of this is that borrowers would have to pay more when they borrow from the bank.”

- A word from our sponsors -

spot_img

Most Popular

More from Author

AEDC, Nasarawa communities at clash over failed metering, estimated billing – VELOXNEWS

From Idu Jude, Abuja Communities in Karu local government area of...

Road to 2023: PDP’ll surmount current challenges

 From Femi Folaranmi, Yenagoa Governor Douye Diri of Bayelsa State has...

NAFDAC warns on dangers of skin care products – VELOXNEWS

From Fred Ezeh, AbujaNational Agency for Food and Drug Administration...

Report on planned sale of TCN fake news-BPE – VELOXNEWS

From Uche Usim, Abuja The Bureau of Public Enterprises (BPE) has described...

- A word from our sponsors -

spot_img

Read Now

AEDC, Nasarawa communities at clash over failed metering, estimated billing – VELOXNEWS

From Idu Jude, Abuja Communities in Karu local government area of Nasarawa state has said that anything short of metering power consumers as ordered by the Federal Government, can no longer be tolerated within their domain, while calling on the National Assembly committees on power, the Nigeria...

Road to 2023: PDP’ll surmount current challenges

 From Femi Folaranmi, Yenagoa Governor Douye Diri of Bayelsa State has expressed optimism that the Peoples Democratic Party, PDP, would surmount its current challenges and emerge victorious at all levels in the 2023 general elections. Governor Diri, stated this at an interdenominational church service organized by the state...

NAFDAC warns on dangers of skin care products – VELOXNEWS

From Fred Ezeh, AbujaNational Agency for Food and Drug Administration and Control (NAFDAC) has raised concerns about the increasing interest on Nigerians on some skin care products some of which are extremely harmful to the skin and the body generally.NAFDAC Director General, Prof. Mojisola Adeyeye, in...

Report on planned sale of TCN fake news-BPE – VELOXNEWS

From Uche Usim, Abuja The Bureau of Public Enterprises (BPE) has described reports in the media that the Federal Government was planning on selling the Transmission Company of Nigeria (TCN) as fake news.The agency, while debunking the report, asked the public to reject it in its entirety.“The allegation...

AEDC, Nasarawa communities at Dagars Drawn Over Failed Mitering, Estimated billings  – VELOXNEWS

From Idu Jude Abuja Communities in Karu local government area of Nasarawa state has said that anything shot of metering power consumers as ordered by the Federal Government, can no longer be tolerated within their domain, while calling on the National Assembly committees on power, the Nigeria...

 Bayelsa kidnap kingpin nabbed in Abuja, moved to Yenagoa – VELOXNEWS

 From Femi Folaranmi, YenagoaA kidnap kingpin behind a series of high profile kidnap incidents in Bayelsa State has been arrested by operatives of Operation Puff Adder in Abuja.The suspect whose real name is John Ewa but changed it to John Lyon was a dispatch rider at...

LP calls for immediate resignation of all APC candidates  – VELOXNEWS

From Adanna Nnamani, AbujaThe Labour Party (LP) has called on all candidates of the All Progressive Congress (APC), to immediately withdraw from the 2023 elections.According to the LP, APC has succeed in ruining and wrecking the economy and future of Nigeria by pushing the country into...

Police confirmed ex Commissioners assassination attempt in Nasarawa State – VELOXNEWS

From Abel Leonard, NasarawaThe Nigerian Police have confirmed the attempted assassination of the Ex- Commissioner of environment, Honourable Musa Ibrahim Abubakar who was alleged to be shot by gunmen Tuesday. The police confirmed the incident via a response by the police public relations officer, DSP Ramhan Nansel...

Road to 2023:Obi, Ahmed meet with IBB – VELOXNEWS

From Adanna Nnamani, AbujaThe presidential candidate of Labour Party (LP), Peter Obi and his running mate, Yusuf Ahamed at the weekend, visited Ex Nigeria’s Military Head of State, General Ibrahim Badamasi Babangida, IBB (rtd) at his residence in Niger State.Sharing photos from the meeting on his...

Kuje Community to expect heavy bombardments – VELOXNEWS

From Isaac Anumihe, AbujaFederal Government has told Kuje Community to expect heavy bombardments from joint interagency simulation training in Kuje Custodial Centre.In a statement, Superintendent of Corrections Public Relations Officer (PRO) Federal Capital Territory (FCT) Command, Chukwuedo Humphrey, said that the simulation training is a strategy...

Taskforce goes tough against Okada riders, impounds 150  – VELOXNEWS

By Christopher OjiThe Lagos State Taskforce has made good its promise to go after all recalcitrant okada operators, Land grabbers,environmental laws violators who have refused to heed the warnings by the State Government to stop their illegal activities.Speaking on Sunday at his office in Bolade, Oshodi,after...

2023:ADC Presidential Candidate, Dumebi Kachikwu urges Nigerians to avoid APC, PDP  – VELOXNEWS

From Charity Nwakaudu, AbujaThe Presidential Candidate of the African Democratic Congress has called on Nigerians not to vote for All Progressives Congress and Peoples Democratic Party candidates during the 2023 general elections. Kachikwu in a statement by his campaign office, in Abuja said the two parties have...