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Banks’ total liquid assets drop to N6,614.8bn

By BusinessNews Staff on April 7, 2014

As the 2013 full financial results of the nation’s deposit money banks continued to trickle in last week, the Central Bank of Nigeria has disclosed that the total specified liquid assets of Nigerian banks stood at N6,614.8 billion in December 2013, representing a decrease of N18.5 billion or 0.3 per cent below the level recorded in November 2013.

According to the CBN’s Quarterly Statistical Bulletin for the fourth quarter of 2013, which was made available last week, the decline was attributed to decrease in other specified liquid assets by 14.3 per cent.

The report said total current liabilities of the DMBs increased by N732.8 billion or 4.6 per cent to N16, 748.9 billion in the review month. It explained that the increase was attributable mainly to the increases in deposit liabilities and other deposits which rose by N629.7 billion and N144.4 billion, respectively. The increase was, however, moderated by the decrease of N41.4 billion in other current liabilities.

“On the average, the DMBs achieved a liquidity ratio of 46.2 per cent in December 2013. This ratio was 16.2 percentage points above the minimum target of 30.0 per cent prescribed for fiscal 2013 but 2.1 percentage points below the level reported in the preceding month.
The report, which covered other activities of banks also, put total assets/liabilities of deposit money banks in December 2013 at N24,334.7 billion, showing increases of N812.2 billion or 3.5 per cent and N3, 030.7 billion or 14.2 per cent above the levels in the preceding month and at end-December 2012, respectively.

According to the apex bank’s report, “The N812.2 billion or 3.5 per cent increase in total assets was attributed to the increases in reserves, claims on central government, claims on state & local government and foreign assets by N558.7 billion or 21.0 per cent, N482.6 billion or 15.8 per cent, N46.9 billion or 6.4 per cent and N15.4 billion or 0.7 per cent, respectively.

“Similarly, the increase in total liabilities was attributed to increases of N390.2 billion or 8.2 per cent, N288.7 billion or 3.5 per cent, N100.7 billion or 3.6 per cent, N65.4 billion or 15.3 per cent and N44.1 billion or 16.9 per cent in demand deposits, time, savings & foreign currency deposits, central government deposits, foreign liabilities and bonds, respectively. This was, however, moderated by the declines of N43.4 billion or 1.6 per cent, N17.8 billion or 0.5 per cent, N13.6 billion or 5.6 per cent and N2.1 billion or 12.8 per cent in unclassified liabilities, capital accounts, credit from central bank and money market instruments, respectively.”

The report stated that at N2, 962.8 billion, unclassified assets decreased by N87.8billion or 2.9 per cent below the level in the preceding month, but increased by N116.6 billion or 4.1 per cent above the level recorded at end-December 2012.

It explained that the decrease in unclassified assets in the review month was attributed to the fall of N174.7 billion or 13.3 per cent and N3.6 billion or 0.3 per cent in other assets.

Meanwhile, the apex bank said aggregate credit to the domestic economy (net) stood at N12,207.7 billion representing increases of N327.7 billion or 2.8 per cent and N414.0 billion or 3.5 per cent above the levels in the preceding month and at end-December 2012, respectively. It attributed the increase to the increases in claims on central government (net) and state and local government by N381.9 billion and N46.9 billion, respectively.

This increase, the report said, were however moderated by declines of N83.2 billion and N18.0 billion in claims on private sector and claims on other financial institutions, respectively.
The report also showed a progressive rise in banks’ credit to the various tiers of government.
For instance, it said net claims on the Federal Government stood at N596.2 billion, showing an increase of N381.9 billion above the level recorded in the preceding month, but a decline of N524.6 billion below the level at end-December 2012. The increase reflected the N515.6 billion increase in treasury bills.

“At N776.7 billion, total credit to state and local governments increased by 6.4 per cent and 16.6 per cent above the levels in the preceding month and at end-December 2012. The 6.4 per cent rise in DMBs claims on state and local governments was accounted for by the increases in all the sub components.”

“In December 2013, total loans and advances of the DMBs to the domestic economy stood at N6,666.8 billion, representing increase of 4.4 per cent above the level in the preceding month, but a decline of 2.4 per cent below the level recorded at end-December 2012.

“At N5,375.2 billion, the domestic investments of the DMBs increased by 0.9 per cent and 12.3 per cent above the levels in the preceding month and at end-December 2012, respectively.
“Total credit extended to the private sector by the DMBs in the review month stood at N10, 005.6 billion. This showed increases of 3.9 per cent and 22.8 per cent above the levels in the preceding month and at end-December 2012, respectively,” the report said.

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