Banks Channel Most Credit to Oil, Gas Sector

By Babatunji Wusu| Deposit Money Banks (DMBs) in Nigeria continued to direct the largest share of lending to the oil and gas sector in 2025, even as financing for manufacturers recorded a sharp decline, according to the latest data released by the Central Bank of Nigeria (CBN).

The CBN’s statistical bulletin showed that total bank lending to the oil and gas industry reached N147.52 trillion in 2025, making it the biggest recipient of credit in the economy. Although the sector retained its top position, the figure represented a slight decline from the N148.82 trillion recorded in 2024.

In contrast, the manufacturing sector experienced a significant reduction in funding. Credit allocated to manufacturers fell by 20.3 per cent to N88.82 trillion, compared with N111.39 trillion in the previous year. The decline highlights growing financing challenges facing industrial production despite its importance to economic growth and job creation.

The report also showed strong growth in lending to the financial sector. Credit to finance, insurance and capital market operators rose by 30.1 per cent to N99.84 trillion, up from N76.73 trillion in 2024.

Other sectors recorded moderate gains. Lending to trade and general commerce increased by 4.4 per cent to N50.82 trillion, while agricultural financing climbed by 26.1 per cent to N38.15 trillion, reflecting continued support for economic diversification efforts.

Government borrowing from banks also increased by 7.2 per cent to N36.19 trillion, while credit to the information and communication sector rose to N23.32 trillion.

Despite growth in some areas, sectors such as real estate, construction and education recorded declines in bank lending during the review period.

Overall, total private sector credit expanded modestly by 1.5 per cent, rising to N700.31 trillion in 2025 from N689.98 trillion a year earlier.

The latest figures suggest that while the oil and gas sector remains the dominant destination for bank credit, lenders are gradually increasing exposure to financial services, agriculture and trade, even as manufacturing continues to face tighter access to funding.