The Central Bank of Nigeria raised its minimum loan-to-deposit ratio requirement for banks to 65% from 60%, in a bid to get banks to further boost credit to small- and medium-sized businesses and consumers, Bloomberg News reported.
The regulator said lenders who fail to comply with this requirement by the end of December will face a higher cash reserve requirement equal to 50% of the lending shortfall implied by the ratio.
Ahmad Abdullahi, director of banking supervision at Nigeria's central bank, said this move comes after some banks failed to meet an earlier deadline.
The central bank said credit grew by 5.3% to 16.40 trillion Nigerian naira as at the end of September, the report noted.
As of Oct. 2, US$1 was equivalent to 361.79 Nigerian naira.
