States and Local Government councils reduced their bank borrowings by about N547.52bn in one year, as Federation Account inflows surge. debt
Figures from the Central Bank of Nigeria’s latest Quarterly Statistical Bulletin reveal that the banking sector’s “claims on state and Local Governments” fell from N2.68tn in June 2024 to N2.13tn in June 2025.
This means sub-national governments collectively cut their indebtedness to commercial and merchant banks by 20.4 per cent year-on-year.
Further analysis shows that in January 2024, banks’ exposure to states and councils stood at N2.73tn. One year later, in January 2025, the figure had dropped to N2.44tn, indicating that about N292bn was cleared during that period.
