In July, Lending, Savings Rates Hit 22.14% – Report

The gap between the maximum lending rate and savings deposit rate in the banking sector widened by 22.14 per cent in July.

Banks savings deposit rate rose slightly to 5.24 per cent in July from 5.18 per cent and 5.13 per cent in June and May, according to figures from the Central Bank of Nigeria.

Figures obtained on money market indicators from the apex bank also revealed that the maximum lending rate fell slightly to 27.38 per cent in July, from 28.94 per cent in June.

The CBN revealed that prime lending rate rose to 13.98 per cent in July from 13.85 per cent in June.

It revealed that 12-month, six-month, three-month, one-month deposit rate, and savings deposit rate in July were 7.83 per cent, 8.54 per cent, 7.68 per cent per cent, 7.15 per cent and 5.18 per cent respectively.

Treasury bills rate rose to 4.45 per cent in July, from 3.87 per cent in June.

The monetary rate and inter-bank call rate were 18.75 per cent and 6.73 per cent respectively.

At the last Monetary Policy Committee meeting in July, the Acting Governor, CBN, Folashodun Shonubi, said after the meeting, members decided to “Raise the MPR by 25 basis points, from 18.50 to 18.75 per cent; Adjust the asymmetric corridor to +100/-300 basis points around the MPR; Retain the CRR at 32.5 per cent; and retain the Liquidity Ratio at 30 per cent.”

He said, the committee remained cautious in arriving at a policy decision as members noted the need to continue to support investment which will ultimately lead to the recovery of output growth.

The balance of these arguments, he noted, was in favour of a moderate rate hike, to sustain efforts at anchoring inflation expectation, narrow the negative real interest rate gap, and improve investor confidence.