Fresh data from the Central Bank of Nigeria (CBN) shows that credit to the Federal Government surged by 75.6 per cent year-on-year, rising from N22.99 trillion in May 2025 to N40.38 trillion in May 2026 — an increase of N17.39 trillion.
The government’s borrowing also grew by N779.7 billion within a month, climbing from N39.60 trillion in April to N40.38 trillion in May 2026.
CBN data indicates that commercial and merchant banks continue to channel substantial funds into Treasury Bills and Federal Government bonds, reflecting the government’s increasing reliance on domestic debt to finance fiscal operations.
In contrast, private sector credit recorded only modest growth, rising from N80.59 trillion in April to N81.04 trillion in May.
Despite the slower pace, private sector lending remained about twice the size of government credit.
Economists warn that the banking sector’s growing preference for government securities could crowd out private businesses by limiting access to affordable credit, potentially slowing investment and economic growth.
The CBN has yet to release a sectoral breakdown of private sector lending for the period.
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