Deposit Money Banks have kept on slashing their borrowings from the Central Bank of Nigeria (CBN) and attributed the decision to excess liquidity in the system.
The CBN disclosed this in its latest monthly economic report, explain that the banks borrowed N15.95bn from the Standing Lending Facility window in November 2020.
The report read in part: “Deposit Money Banks and merchant banks continued to access the standing facilities window to square liquidity positions in November 2020.
“The trend at the CBN standing facilities window showed more frequency at the Standing Deposit Facility window, compared with the Standing Lending Facility, due to the banking system liquidity surfeit.
“Applicable rates for the SLF and SDF stood at 12.5 per cent and 4.5 per cent, respectively.
“Total request for the SLF granted from November 1-26, 2020 was N15.95bn, made up of N3.15bn direct SLF and N12.79bn Intraday Lending Facilities converted to the overnight repo.”
The report added that the daily average was N2.66bn in six transaction days from November 1-26, 2020.
According to it, the total interest earned was N0.09bn. Total SDF granted, during the review period, was N726.98bn with a daily average of N38.26 billion in 19 transaction days from November 1-26, 2020.