“NPL Worries Escalate as Nigeria Borrows N875 Billion from GTBank, UBA, and Zenith Bank”

Date:

  • “Zenith Bank: Nigerian Government Receives N875 Billion in Loans in 2023”
  • “UBA’s Governmental Loans Reach N509.6 Billion in 2023, Reveals Naija247news Investigation”
  • “GTBank’s Involvement: N52.2 Billion Lent to Nigerian Government in 2023”

Recent financial statements analysis conducted by Naija247news has uncovered startling revelations about the Nigerian government’s borrowing spree from banks between 2022 and 2023.

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In 2023 alone, data from Zenith Bank’s financial records indicate that governments at various levels received a substantial sum, accounting for 12.4% of the total loans disbursed by the bank, amounting to a staggering N875 billion out of N7.06 trillion.

The trend continues as in 2022, Zenith Bank extended 12.9% of its N4.12 trillion loan portfolio to the government, totaling N531 billion in loans.

Similarly, United Bank for Africa PLC (UBA) lent N509.6 billion to the government in 2023, constituting 9.1% of its N5.6 trillion total loans. In the previous year, UBA allocated 11.4% of its N3.4 trillion loans to the government, amounting to N531 billion.

Guaranty Trust Bank (GTBank) also participated in governmental borrowing, providing N52.2 billion in loans to the Nigerian government in 2023.

However, the borrowing spree has not been without consequences. Non-performing loans (NPLs) have become a concern, with the government contributing to a portion of these defaults. For instance, in 2023, the government’s responsibility for NPLs accounted for 0.18% of Zenith Bank’s N310 billion non-performing loans.

The reliance on domestic borrowing is evident, as revealed by budget performance reports from various states, raising concerns about the sustainability of this approach.

Moreover, the Central Bank of Nigeria’s recent decision to revoke the license of Heritage Bank due to poor financial performance underscores the gravity of the situation. Non-performing loans pose a significant challenge to banks, jeopardizing their financial stability.

As banks grapple with the burden of non-performing loans, the unchecked borrowing by Nigerian states exacerbates the problem, painting a worrisome picture for the country’s financial sector.

Godwin Okafor, The Naija247news
Godwin Okafor, The Naija247newshttps://naija247news.com
Godwin Okafor is a veteran Financial Journalist, Internet Social Entrepreneur, and the visionary Founder of Naija247news Media Limited. With an extensive career spanning over 16 years in financial journalism, Godwin possesses a wealth of experience that seamlessly bridges both traditional and digital media landscapes. His journey in journalism commenced at Business Day, Nigeria, where he laid the foundation for his prolific career. In 2010, Godwin took a bold step by founding Naija247news Media, a platform that has since become a prominent player in delivering timely and accurate news. Educationally, Godwin Okafor holds a Bachelor's degree in Industrial Relations and Personnel Management from the prestigious Lagos State University, Ojo, Lagos. His commitment to continuous learning led him to the Lagos Business School, where he further honed his skills. Additionally, he is recognized as a Fellow of the University of Pennsylvania, having successfully completed the Wharton Seminar for Business Journalists. Throughout his illustrious career, Godwin has earned acclaim by winning numerous journalism awards, a testament to his dedication to excellence in reporting. Beyond his role as a Financial Journalist, Godwin Okafor wears the hat of the Chairman at Emmerich Resources Limited, the publishing entity behind Naija247news. His visionary leadership has played a pivotal role in shaping the media landscape and establishing Naija247news as a trusted source of information. Godwin Okafor's multifaceted expertise, commitment to journalistic integrity, and leadership in the realm of business journalism underscore his influential presence in both the media and entrepreneurial spheres.

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