Nigeria: Banks Raise Lending Rates for Top Borrowers Despite CBN Cuts

What the report says

Nigeria’s banks have increased average prime lending rates in several major sectors even after the Central Bank of Nigeria lowered its benchmark policy rate in a series of cuts from 2025 through September 2026, according to a Vanguard report republished by AllAfrica. The report says the higher rates were seen in eight of 11 tracked sectors, including agriculture, construction, manufacturing, real estate, education, government, health and finance, with some of the biggest increases in agriculture and construction. The article notes that the changes affect preferential borrowing terms offered to creditworthy corporate clients and could slow financing for businesses in productive parts of the economy.

The publication contrasted those increases with a decline in average maximum lending rates across most sectors, suggesting that not all borrowers are facing the same pricing trend. It also reported that banks have reduced what they pay depositors, including savings and time-deposit rates. That combination points to banks re-pricing loans and deposits differently as policy rates fall.

Analysts quoted by Vanguard said the pattern does not necessarily mean monetary policy is failing, but rather that rate cuts often move through the banking system unevenly and with a delay. They pointed to factors such as funding costs, liquidity, borrower risk and bank-specific pricing decisions. The report said the timing of the latest CBN cut may also mean its full impact has not yet appeared in lending data. The development matters because borrowing costs influence investment, working capital and expansion plans for Nigerian companies.