Deposit banks’ borrowing from the Central Bank of Nigeria, CBN, rose year-on-year by 12 per cent to N2.02 trillion in September 2022.

The CBN has two short term lending windows for banks namely the Standing Lending Facility, SLF, and Repo lending.

While the CBN lends money to banks through the SLF at interest rate of 100 basis points above the Monetary Policy Rate, it also lends money to banks through Repurchase arrangement, which involves the purchase of banks’ securities with the agreement to sell back at a specific date and usually for a higher price.

Data from the CBN Financial Statistics for September 2022 showed that banks’ borrowing through Repo arrangement rose in September 2022 by 13 per cent, year-on-year, to N1.19 trillion from N1.05 trillion in September 2021.

Similarly, banks’ borrowing through the CBN’s SLF rose by 10 per cent, year-on-year, to N836.48 billion in September 2022 from N756.37 billion in September 2021.

Consequently, banks’ borrowing from the apex bank through the SLF and Repo rose by 63 per cent year-on-year to N2.02 trillion in September 2022 from N1.8 trillion in September 2021.