As the Federal Government of Nigeria (FGN) and the government of the 36 states and FCT continue to seek ways out of the current national food crises, a report has been released today showing that Nigeria’s commercial banks gave N4.68 trillion as loans to the country’s agricultural industry from 2018-2022......See Full Story>>.....See Full Story>>
Titled “Commercial Bank Lending to the Nigerian Agricultural Industry 2018-2022,”the report was published by an Abuja-based firm, Alford Conferences Limited, as part of its preparation towards its event called Nigerian Food Surplus Summit.
While announcing the release of this report, the CEO of Alford Conferences, Mr. Frederick Apeji, explained that, “We advocate that Nigeria’s commercial banking sector should seek creative ways to increase the share of its loan portfolio devoted to growing the country’s agricultural industry in the years ahead, beyond the 5.03% that it gave to the industry during the period under review. More importantly, we also advocate that the government of the 36 states and FCT should deliberately work more closely with these commercial banks in order to attract appropriate funding for bankable businesses and projects across the agricultural value chains in their respective domains.”
“The total five-year bank lending of N4.68 trillion given to the agricultural industry compares favourably with the N8.18 trillion internally generated revenue (IGR) that was raised collectively in these past five years by the FCT and the 36 states. This IGR figure is tracked annually by Alford Conferences Limited. Another figure worthy of comparison is the N1.12 trillion Anchor Borrowers Fund established by the Central Bank of Nigeria (CBN) in November 2015 to support small holder farmers (SHF) throughout the country.”
According to Mr. Apeji “We focused on those banks that hold the CBN license to operate either internationally or nationally to produce this report Amongst them (22 in all), we looked at the ones that had at least N1tr in loans and advances during the period under review (2018-2022), irrespective of how much they gave to the Nigerian agricultural industry. The 12 banks thus captured in this report are (in order of the size of their loan portfolio): Access Holdings Plc, Zenith Bank Plc, FBN Holdings Plc, United Bank for Africa Plc, Guaranty Trust Holding Company Plc, Fidelity Bank Plc, Ecobank Nigeria Limited, First City Monument Bank Plc, Stanbic IBTC Holdings Plc, Sterling Financial Holdings Company Plc, Union Bank of Nigeria Plc and Wema Bank Plc.”
Based on the report, Access Holdings was the biggest lender in Nigeria from January 1, 2018-December 31, 2022 (N17.386 trillion) and also the biggest lender to the country’s agricultural industry (N928.55 billion) during this period. Zenith Bank was the 2nd biggest lender in Nigeria (N14.278 trillion), and also the 2nd biggest lender to the country’s agricultural industry (N873.36 billion). FBN Holdings, the 3rd biggest lender in Nigeria with N12.411 trillion, however ranked 7th among the 12 banks in this report based on its total loans of N285.18 billion to the agriculture.
The report further indicated that Ecobank Nigeria gave the highest percentage of its total loans of N4.68 trillion to the agricultural industry. This stood at N574.69 billion, representing 12.28%. Sterling Bank and FCMB Group ranked 2nd and 3rd respectively in terms of their percentage commitment to supporting the Nigerian agricultural industry these past five years. Though small players in the banking industry, they gave 8.19% and 7.58% respectively to agriculture, historically the biggest employer of labour in this country. The three other banks that performed better than the industry average of 5.03% in agricultural lending during this period were Zenith Bank (6.12%), Access Holdings (5.4%) and Stanbic IBTC Holdings Plc (5.33%).
Established in April 2014, Alford Conferences Limited, the convener of the annual Nigeria Food Surplus Summit, is an event production company and a consulting firm that advises the Nigerian and African public sector on subnational revenue generation, agribusiness development, export promotion, strategic investment promotion, host country/host city marketing, pan-African trade, etc.
The forthcoming Nigeria Food Surplus Summit is a nationwide advocacy that seeks to help Nigeria to successfully feed itself and have a large surplus for export by strengthening the commercial farming, food processing, and agricultural machinery segments of the country’s agricultural industry. For decades, up till this present moment, the burden of feeding this country of over 220 million people has rested largely on the shoulders of its millions of smallholder farmers. The summit seeks to strongly complement this by deliberately promoting and boosting commercial farming, food processing, and the production of agricultural machinery on a large scale in each of the 36 states and FCT, partnering actively with their respective ministry of agriculture.