The 2017, nine months results of Nigeria’s tier one banks, comprising FBN Holdings, UBA, GT Bank, Access and Zenith showed a combined earnings of about N451.8 billion from treasury bills and government bonds, compared to N270 billion earned same period in 2016.
The top 5 banks made a combined N1.4 trillion in interest income for the first 9 months of the year, compared to N1.1 trillion in the same period in 2015. In summary, 33% of bank interest income was from Treasury Bills and Government Bonds compared to 25% in the same period in 2016, Nairametrics reported.
In 2017, Nigerian banks increased purchase of government securities against increasing loans to the private sector. Government securities have offered yields in excess of 18% for the year as government increases reliance on local borrowing to fund the Federal Budget as well as plug its deficit. Government is now considering borrowing in cheaper foreign currency and reducing its more expensive local debts.