Nigerian banks and discount houses borrowed N3tn from the Central Bank of Nigeria through the Standing Lending Facility within a week, according to a report by Afrinvest Research.
The lenders and discount houses, however, deposited N493.6bn through the Standing Deposit Facility within the same period.
According to the report, the spike in borrowing resulted in a 4.7 per cent increase in system liquidity, which now stands at N712.3bn.
The Standing Lending Facility and Standing Deposit Facility are tools used by the Central Bank to manage money supply and liquidity in the financial system.
The central bank issued a new directive to boost lending to the real sector, which took effect in April, signaling a shift towards a contractionary monetary policy approach.
Recently, the Central Bank lifted the suspension on the Standing Lending Facility for authorised dealers, following a Monetary Policy Committee decision to adjust the upper corridor of the standing facilities to five per cent from one per cent around the Monetary Policy Rate.
