CBN lifts suspension on bank borrowing, sets 31.75% lending rate

The Central Bank of Nigeria (CBN) has lifted the suspension on banks borrowing from its Standing Lending Facility (SLF) and set the lending rate at 31.75%, following decisions made at the 296th Monetary Policy Committee (MPC) meeting.

In a statement dated August 26, 2024, Omolara Duke, the Director of the Financial Markets Department, confirmed the MPC’s adjustment of the upper corridor of the standing facilities to 5.00% from the previous 1.00% around the Monetary Policy Rate (MPR).

This adjustment led to the resumption of the SLF, allowing authorised dealers to submit their borrowing requests via the Scripless Securities Settlement System (S4) between 5:00 pm and 6:30 pm.

“Consequently, the suspension of the Standing Lending Facility (SLF) is hereby lifted, and Authorised Dealers should send their request for SLF through the Sceipless Securities Settlement System (S4) within the operating hours of 5 pm to 6.30 pm.”

The CBN also stipulated that authorised dealers could access the SLF at the newly set rate of 31.75%.

Additionally, they can access the Intraday Liquidity Facility (ILF) at no cost if repaid on the same day.

However, a 5% penalty remains for participants who fail to settle their ILF, which the system will convert to SLF at a rate of 36.75%.