CBN retains minimum 65% loan deposit ratio – TheNigerialawyer

The Central Bank of Nigeria (CBN) said on Wednesday it has
retained the minimum 65 percent Loan Deposit Ratio (LDR) in the
interim.

The apex bank disclosed this in a circular signed by its
Director of Banking Supervision, Mr. Ahmad Abdullahi, in Abuja.

The CBN said it had noticed a remarkable increase in the size of
gross credit by the Deposit Money Banks (DMBs) to customers.

It enjoined all DMBs to maintain this level and ensure that
average daily figures were applied to assess compliance.

The bank said: “The incentive which assigns a weight of 150
percent in respect of lending to Small and Medium Enterprises
(SMEs), retail, mortgage as well as consumer lending shall continue
to apply.

“While failure to achieve the target shall continue to attract a
levy of additional cash reserve requirement of 50 percent of the
lending shortfall of the target LDR on or before March 31,
2020.

“DMBs are further encouraged to maintain strong risk management
practices regarding their lending operations.”

The apex bank said it would continue to monitor compliance,
review market development and make further alterations in the LDR
as it deems appropriate. (NAN)