The National Bureau of Statistics (NBS), in its latest Banking Sector Data, said Nigeria’s oil and gas sector’s indebtedness to banks reached N3.58 trillion as at the fourth quarter of 2017, The Guardian reports.
This is, however, higher than the N3.55 trillion, which the sector recorded during the third quarter of the same year. Besides, the country’s electricity sector loans from banks decreased from N459 billion in third quarter to N453.9 billion in the period under review. The NBS noted that the oil & gas sector got credit allocation of N3.58 trillion out of the N15.74 trillion loans available to the private sector, to record the highest credit allocation in the period under review.
Speaking on oil and gas exposure to Nigerian banks, First Vice President of the Chartered Institute of Bankers of Nigeria (CIBN), Dr. Uche Olowu, said that the unpaid subsidy arrears to oil marketers had created a liquidity gap in the industry and had led to a negative impact on banks’ operational costs. According to him, the development has led to a transactional velocity of money, which has impacted negatively on the economy.