Is Nigeria’s Falling Non-Performing Loans a Sign of Tightening Credit or Bank Stability?

Oct. 9, 2024 - Dataphyte

+Tips on how to get loansNon-performing loans (NPLs) in Nigerian banks, as a percentage of total loans, have been on the decline. A falling NPL ratio signals an overall improvement in the health of Nigeria’s banking sector.

NPLs refer to bank loans that are either unlikely to be repaid by the borrower or are subject to late repayment. In Nigeria, the Central Bank of Nigeria (CBN) has raised interest rates 29 times since January 2022.

The rise in interest rates is also expected to increase yields on personal savings and bank deposits, impacting dividends for bondholders and shareholders...