Nigerian banks have deposited an estimated N77.19 trillion with the Central Bank of Nigeria (CBN) through the Standing Deposit Facility (SDF) in 19 business days in September 2026. This represents an average daily deposit of N4.06 trillion during the period. The large volume of funds deposited with the CBN reflects lenders' efforts to seek safe and risk-free returns for excess liquidity.
In contrast to the large deposits, banks borrowed an estimated N920 billion from the CBN through the Standing Lending Facility (SLF) during the same period. The SDF allows banks to place excess liquidity with the CBN and earn interest, while the SLF provides short-term funding to banks facing liquidity shortages. This highlights the varying liquidity needs of banks in the financial system.
The volume of funds placed with the CBN has remained high despite fluctuations in monthly deposits. In June, banks deposited N89.3 trillion, followed by N87.13 trillion in May and N92.32 trillion in April 2026 through the SDF. The highest monthly figure so far this year was recorded in March, with banks depositing about N128.92 trillion.
The cumulative deposits of banks with the CBN in the first eight months of 2026 stood at an estimated N678.36 trillion. This represents a 610.58 per cent increase over the N95.47 trillion recorded in the corresponding period of 2025. The sharp increase in funds parked with the apex bank comes amid efforts by lenders to manage liquidity and secure returns in the overnight market.
The Monetary Policy Committee (MPC) decision on September 22, 2026, reset the Monetary Policy Rate (MPR) to 23 per cent and recalibrated the asymmetric corridor to +50 and -300 basis points around the MPR. This decision lowered the SDF rate to 20 per cent, while the SLF rate fell to 23.50 per cent. The lower SDF rate means banks will now earn less on excess funds placed with the CBN.
Analysts at Cordros Research assessed the September 22 MPC decision, noting that the adjustment of the asymmetric corridor was designed to narrow the gap between the MPR and the lower bound. The adjustment is expected to strengthen the transmission of monetary policy decisions to short-term market rates and reinforce the signalling role of the MPR.
The analysts added that the Standing Lending Facility rate declined to 23.50 per cent from 27 per cent, while the Standing Deposit Facility rate fell to 20 per cent from 22 per cent. They expect market performance to be shaped by the extent to which the policy adjustment translates into lower market yields, improved liquidity, and reduced corporate financing costs.
Key points
- Nigerian banks deposited N77.19 trillion with CBN in 19 days in September 2026
- CBN's MPC decision lowered SDF rate to 20 per cent and SLF rate to 23.50 per cent
- Banks' cumulative deposits with CBN rose 610.58 per cent to N678.36 trillion in 8 months of 2026
