The Central Bank of Nigeria has raised the alarm over rising loan defaults among large private non-financial corporations and other financial institutions. According to its latest Credit Conditions Survey Report for the first quarter of 2025, both segments posted negative default index scores of minus 0.6, indicating worsening loan repayment performance.
This represents a reversal of gains recorded in the previous two quarters. Large corporates, which had shown positive repayment trends in late 2024, are now facing renewed difficulty servicing debts—raising concerns about credit risk at the upper end of Nigeria’s lending market.
In contrast, small and medium-sized businesses reported better repayment behaviour. Small firms posted a positive default index of 0.5, while medium PNFCs scored 3.0, suggesting more resilient cash flows and improved loan management among these segments.
Household loans also continued to perform strongly, with secured lending at 3.9 and unsecured lending at 5.0. Demand for credit rose across board, particularly for personal loans and overdrafts, but lenders have responded by tightening credit scoring criteria—becoming more selective even as appetite for loans remains high.
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