Chai! My people, e be like say Naija banks don dey shout again as people no fit pay loan wey dem borrow.
According to the Central Bank of Nigeria (CBN), dem don notice plenty people and businesses dey default on loan wey dem collect, as di stress for credit market dey increase. E no be small matter o, na wey we dey talk about loan, secured or unsecured, everybody dey feel am.
Dem talk say for last quarter of 2025, di lenders report say e get higher rates of default for all kind loans, and this one dey worry for body. People wey suppose pay back na dem dey face wahala because of high interest rates wey dey make money no dey rich. Inflation dey chop their pocket, and na im make dem dey struggle to meet up with repayment plans.
For secured loans wey dey have collateral, dem even dey see bad news as di report show net balance of minus 2.2 points, even though e don improve from wahala wey dem get in 2023 and early 2024. E mean say borrowers dey suffer well well, even when dem don got something to back di loan.
As for unsecured loans, na different level matter wey dey happen. People dey find am hard to manage, with a net balance of minus 3.0 points, and this one dey show say unnecessary pressure dey remain on top households as dem dey fight to clear debts from personal loans, overdrafts, and credit card wahala.
Small businesses dey feel am pass, as dem dey run with high energy costs and nobody dey buy wetin dem dey sell. Na im make dia net balance reach minus 3.9 points for small businesses, while medium firms dey hold minus 3.8 points. Big men wey get large corporations no dey well too, as dem dey see minus 6.0 points due to forex wahala and rising cost of servicing debts.
Wetin make matter dey worse be say banks report say dem get increased supply of loans, but e no fit balance because plenty people dey still default. Credit demand don increase, but repayment dey choke people as spending power dey decline.
Dem also talk say interest rates no dey fall, instead, e dey rise, and dis one dey increase borrowing costs, making am hard to service debts. Na why as we dey move towards second quarter of 2026, many dey fear for wetin fit happen next.
The CBN also don flag say di bad loans for banking sector don increase to 7%, which dey past di prudential benchmark of 5%. Dis one dey happen because of di policy change wey dey happen since di end of COVID-19 pandemic regulatory forbearance.
Even with all dis wahala, CBN still dey talk say financial system still dey stable because of strong capital buffer and liquidity wey banks stack up. Di liquidity ratio dey show strong 65%, and e dey above 30% wey dem require.
But make we shine our eye! CBN don pata-pata say make dem find beta way to manage these non-performing loans, as dis fit lead to serious stress for di entire banking sector.
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