Banks Face Rising Bad Loans as CBN Ends Forbearance Measures
Nigeria’s banking industry recorded a rise in non-performing loans in 2025 following the Central Bank of Nigeria’s withdrawal of regulatory forbearance, with the NPL ratio climbing to about 7 per cent—above the 5 per cent prudential limit. The increase reflects the reclassification of previously restructured pandemic-era loans now recognised as impaired. While the CBN says the sector remains resilient, supported by strong liquidity, adequate capital buffers, and ongoing bank recapitalisation, it cautioned that persistently high bad loans could pose risks amid tight monetary conditions, urging stronger risk management and full implementation of the Global Standing Instruction framework.