Banks’ deposit with the Central Bank of Nigeria, CBN, grew by 568.7 percent, YoY, to N146.13 trillion in the first nine months of the year (9m’25) from N21.85 trillion in the corresponding period of 2024 (9m’24), indicating excess liquidity in the banking system.
Trend analysis showed that banks’ deposits in SDF rose sharply by 158.4 percent Quarter-on-Quarter (QoQ) to N49.68 trillion in the second quarter of 2025 (Q2’25) from N19.22 trillion in Q1’25. In Q3’25, banks deposited N77.23 trillion, up by 55.4 percent.
The highest deposit of N50.73 trillion was recorded in September 2025.
The continuous strong patronage of the SDF reflects excess liquidity in the banking system and the effect of the CBN’s shift to a single-tier remuneration structure for the SDF last year.
The CBN has two short term lending windows for banks; the Standing Lending Facility (SLF) and Repo lending.
It lends money to banks through the SLF at interest rate of 500 bps above the Monetary Policy Rate (MPR), and it also lends money to banks through Repurchase (Repo) arrangement, which involves the purchase of banks’ securities with the agreement to sell back at a specific date and usually for a higher price.
On the other hand, the CBN accepts deposits from banks through its Standing Deposit Facility (SDF) and pays an interest rate of MPR minus 100 bps .
But banks’ borrowings through the Central Bank of Nigeria, CBN, Standing Lending Facility, SLF, declined by 12.4 per cent YoY to N69.37 trillion in the first nine months of the year (9m’25) from N87.09 trillion in 9m’24.
