• Oil sector lending weakens to N10.58trn in March
Nume Ekeghe
Deposit money banks significantly increased financing to trade and commerce in the first quarter of 2026, even as lending to manufacturing and oil and gas declined, highlighting a shift in the distribution of bank credit across key sectors of the economy.
Data from the Central Bank of Nigeria’s (CBN) Q1 2026 Statistical Bulletin showed that credit to trade and general commerce rose by 34.6 per cent from N4.67 trillion in January to N6.29 trillion in March.
The N1.62 trillion increase made trade and general commerce the strongest-growing major sector during the three-month period.
Credit to the sector rose sharply from N4.67 trillion in January to N5.54 trillion in February before climbing further to N6.29 trillion in March.
The March figure represented an increase of about N750 billion, or 13.5 per cent, from the February level.
The expansion in trade financing came alongside increased lending to construction and power, while some major productive sectors recorded contractions.
The report also showed that credit to construction rose from N2.14 trillion in January to N2.65 trillion in March, representing an increase of 24.2 per cent. Power and energy lending also increased by 23.7 per cent, from N1.30 trillion in January to N1.61 trillion at the end of March.
The finance, insurance and capital market sector recorded a more moderate expansion, with credit rising from N9.03 trillion in January to N9.80 trillion in March. This represented an increase of N768 billion, or 8.5 per cent, over the period. Credit to the sector stood at N9.16 trillion in February before accelerating to N9.80 trillion in March.
Agricultural lending also recorded growth, although at a slower pace, rising by about four per cent from January to March.
The increase in lending to these sectors, however, contrasted with a decline in credit to manufacturing, one of the key productive segments of the economy.
Manufacturing credit fell from N6.57 trillion in January to N5.77 trillion in March, representing a decline of about N807 billion, or 12.3 per cent.
Oil and gas lending also weakened during the quarter, falling from N10.91 trillion in January to N10.71 trillion in February and further to N10.58 trillion in March.
The N335 billion reduction represented a decline of about 3.1 per cent between January and March.
The contraction in oil and gas lending was notable given the sector’s position as one of the largest recipients of bank credit. Despite the decline, oil and gas remained the largest credit exposure among the sectors highlighted in the data, with outstanding loans of N10.58 trillion at the end of March.
The finance, insurance and capital market sector followed with N9.80 trillion, while trade and general commerce stood at N6.29 trillion and manufacturing at N5.77 trillion.
Government credit also recorded a mixed trend during the quarter as banks’ credit to government stood at N3.45 trillion in January, declined to N3.26 trillion in February and recovered to N3.38 trillion in March.
Despite the March rebound, government credit remained about N70 billion below its January level. The contrasting movements across sectors suggest that the expansion in bank lending during the first quarter was not broad-based. Rather, credit growth was concentrated in sectors such as trade, construction, power and finance, while manufacturing and oil and gas recorded declines.
Trade alone accounted for a substantial portion of the increase in credit across the major sectors, with its N1.62 trillion rise between January and March exceeding the combined increase recorded in several other sectors.
The trend also indicates stronger bank financing of commercial activities, construction and infrastructure-related businesses during the quarter, even as exposure to manufacturing and oil and gas was reduced.
By the end of March, the finance, insurance and capital market sector had attracted N9.80 trillion in bank credit, representing a significant increase from the N9.03 trillion recorded at the start of the year.