CBN: N105 trn Kept in Armoury Does not Win War, they must be deployed By Clem Aguiyi

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N105.01 trillion is the size of customer deposits held by five Nigerian banks. As of September 30, 2026, the total stands at a record level.

It is the biggest mountain of cash in Nigeria’s corporate history. It is more than double the Federal Budget. It is more than the GDP of Ghana, Kenya and Rwanda combined.

This context underscores a broader point in policy debates. This note states CBN: N105 trn Kept in Armoury Does not Win War, they must be deployed By Clem Aguiyi.

The five banks pooled N96.57 trillion in December 2025.

Ecobank Transnational, Zenith Bank, First HoldCo, GTCO, and Stanbic IBTC contributed N8.44 trillion in nine months.

They control 57.19% of industry assets and 58.44% of deposits.

CBN: N105 trn Kept in Armoury Does not Win War, they must be deployed By Clem Aguiyi.

However, a drive from Marina to Ariaria reveals a paradox. Vaults are full, but factories sit empty. Furthermore, the contrast between abundance and need grows clearer as you move. Additionally, the gap in daily life and in the markets is felt by people.

Moreover, a mountain of deposits sits on a valley of poverty. Nevertheless, CBN: N105 trn Kept in Armoury Does not Win War, they must be deployed By Clem Aguiyi. Consequently, this tension invites policy talk and practical steps. Additionally, countries must balance relief with investment.

Banks prefer Treasury Bills for liquidity and safety. In addition, they offer short maturities and easy trading, which appeals to lenders. CBN: N105 trn Kept in Armoury Does not Win War, they must be deployed By Clem Aguiyi.

For every N100 deposited, only N35-N40 goes to a business as loan. GTCO LDR is 27%, UBA 32%, Zenith and Access 39%. World Bank says only 32.6% of banking assets are loans, 22% are government securities.

N36.5 trillion is lent to government, not Nigerians. As a note, CBN: N105 trn Kept in Armoury Does not Win War, they must be deployed By Clem Aguiyi. The data underscores the need to translate deposits into productive lending for Nigerians.

Why? Five cold calculations:

Capital: T-Bill risk-weight 0% (needs no capital), SME loan 100% (needs N1.5bn capital for N10bn loan).
Default: T-Bill default 0%, industry NPL 7.51%, oil & gas 44.9%.
Return: T-Bill 22% with zero work, SME loan 35% nominal but 2-3% real after cost (22%), provision (5%), operational cost (5%) and NPL.
Liquidity: T-Bills help meet 30% liquidity ratio and cover loss from 45% CRR locked at zero.
Safety: T-Bill has no name, no EFCC probe, no insider lending scandal. Directors with bad insider loans now must resign.

Banks are rational. They choose easy 22% risk-free over difficult 3% risky. That is why they declare N4trn profits while SMEs die.

Why CBN Locked The Vault

Cardoso met a burning economy in 2023: inflation 34.19%, naira N1,600/$, Ways & Means N27tr printed, money supply growing 50%.

He locked the vault with three keys:

CRR 45%: N49.5tr of N110.19tr deposits frozen at CBN at zero interest. Dead money to kill inflation.
MPR 26.5%: Cost of funds jumped to 20-22%, lending rate to 30-35%. No business could borrow, so banks stopped lending.
OMO N10tr mop-up + LDR cut to 50%: CBN told banks to lend only 50% of deposits, down from 65%, to reduce money creation.

It was brutal, but it worked. Inflation fell to 20.12%, naira stabilized, reserves rose, trust returned, deposits surged to N105tr. The naira was saved.

MPR at 26.5% – The Real Price of Money

MPR is the price of money. At 26.5%, the real cost for banks is 20-22% after CRR. To lend, they must charge 30-35%. No farmer, manufacturer or trader can survive at 35%. So they don’t borrow, banks don’t lend, credit to private sector grew only 9% real.

The price of MPR 26.5% is not paid by banks (record profits), but by economy: SMEs get <5% of credit though they contribute 48% of GDP, manufacturing capacity <40%.

How CBN Can Unlock to Save Economy

The fire is controlled. Now vault must be unlocked gradually:

Tiered CRR: Banks with LDR >60% and NPL <5% get CRR 25%, others 45%. Free N4-6tr without printing.
Risk-weight on T-Bills: Assign 10% risk-weight to excessive T-Bills above threshold, so banks need more capital to hold T-Bills than SME loans.
Crush insider lending: Enforce Feb 2025 Circular, Single Obligor Limit. Free N1tr from one oil baron to fund 100,000 SMEs.
De-risk borrower: Expand collateral registry, credit bureaus, small claims courts, 50% guarantees via BOI/DBN/MOFI. April 2026 SME credit rose to N199bn from N153bn because CBN upgraded DFIs limits.
Reduce OMO yields: Shift OMO to shorter tenors, open to non-banks, stop offering 22% risk-free. When T-Bill falls to 14%, banks will lend at 20%.

CBN has started: MPR cut to 23% in Sept 2026, new AI Supervisory Examination App, Risk-Based Capital Framework March 2026, recapitalisation N4.65tr completed March 31 2026.

Cardoso locked the vault to save the naira. History will record that. Now he must unlock it to save the economy. A vault permanently locked does not save wealth, it buries it. N105 trillion kept in armoury does not win war.

The ammunition exists. Now it must be deployed.