Amid excess liquidity in the financial sector, banks and merchant banks borrowing from the Central Bank of Nigeria (CBN) dropped by 12.84 per cent to N65.53 trillion in seven months of 2025 compared with N75.18 trillion borrowed in seven months of 2024.
According to the “Financial Data” released by the CBN, banks and merchant banks deposit, however, grew significantly by 671.2 per cent to N79.84 trillion in seven months of 2025 as against the N10.35 trillion deposited in seven months of 2024.
Banks and merchant banks access lending from the apex bank using the Standing Lending Facility (SLF) window and deposit excess cash with the apex bank using the Standing Deposit Facility window (SDF).
The CBN lends money to banks and merchant banks through the SLF at an interest rate of 500 basis points (bpts) above the Monetary Policy Rate (MPR), accepts deposits from banks and merchant banks through its SDF and pays an interest rate of MPR minus 100 basis points.
