Mustapha Akinwunmi, a member of CBN’s Monetary Policy Committe (MPC) has said that the at least 11 commercial banks exceeded the 5 percent regulatory limit for non-performing loans (NPL) in April 2025. The increased number is due to an industry-wide loan reclassification during annual risk assessment.
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The reclassifications, which typically occur as part of year-end credit quality evaluations, caused the industry-wide NPL ratio to rise above the CBN’s 5 percent prudent benchmark. This marks an increase from a year earlier, when only six banks were guilty of the breach. The names of the 11 banks guilty of this breach were not disclosed.
“The Non-Performing Loans (NPL) ratio rose to 5.62 percent in April 2025, exceeding the 5 percent prudential threshold, largely due to loan reclassifications following annual risk assessments,” Akinkunmi said in a personal statement released after the 300th MPC meeting in May.
Business Day reported that Mr. Akinkunmi made this known in a personal statement released after the 300th MPC meeting in May.
Akinwunmi noted that the breach reflects a more accurate accounting of credit risk rather than a sudden deterioration in asset quality. According to him, the CBN might consider temporary forbearance measures for sectors like oil and gas that are more exposed to global shocks.
CBN’s Monetary Policy Committee had at the end of its 301st meeting on July 22, with all 12 members in attendance, retained interest rate at 27.50 per cent, while keeping all policy parameters constant.
Nnamdi Maduakor is a Writer, Investor and Entrepreneur
