Banks in Nigeria recorded increased default rates on secured loans in the third quarter of 2025 (Q3’25), even as overall credit availability improved across multiple lending categories, according to a new report by the Central Bank of Nigeria (CBN).

The Credit Conditions Survey, released on Wednesday, indicated that while defaults on secured loans rose, default rates for unsecured loans declined during the same period. Lenders attributed the growth in credit availability to improved economic conditions for secured and corporate lending, while increased risk appetite drove unsecured credit expansion.

The report noted: “Lenders reported a decrease in default rates for unsecured lending while experiencing an increase in default rates for secured lending during the review quarter.”

Corporate lending fared better, with default rates falling across all segments, including small businesses, medium-sized Private Non-Financial Corporations (PNFCs), large PNFCs, and Other Financial Corporations (OFCs).

Loan approval rates also increased across secured, unsecured, and corporate lending, reflecting a broader improvement in access to credit.

The survey highlighted changes in lending rate spreads relative to the Monetary Policy Rate (MPR):

  • Secured household lending spreads widened by –0.1 index points
  • Unsecured household lending spreads widened by –1.8 index points
  • Medium PNFCs and OFCs saw spreads narrow by 2.6 and 14.4 index points, respectively
  • Spreads widened for small businesses and large PNFCs by –0.8 and –0.4 index points

The CBN survey sgnal a mixed performance in the lending landscape, with banks navigating rising defaults in secured loans while maintaining cautious optimism through expanded credit for corporate and unsecured borrowers.

Follow Our WhatsApp Channel ______________________________________________________________________________________________________

[A MUST HAVE] Evidence Act Demystified With Recent And Contemporary Cases And Materials

“Evidence Act: Complete Annotation” by renowned legal experts Sanni & Etti.

Available now for NGN 40,000 at ASC Publications, 10, Boyle Street, Onikan, Lagos. Beside High Court, TBS. Email publications@ayindesanni.com or WhatsApp +2347056667384. Purchase Link: https://paystack.com/buy/evidence-act-complete-annotation

______________________________________________________________________ “Enhance Legal Practice With Authoritative Reports” — Alexander Payne Offers Comprehensive Law Reports, Spanning Over A Century Of Nigerian Jurisprudence

Interested buyers are encouraged to place their orders and enquiries via: 0704 444 4777, 0704 444 4999, 0818 199 9888 Website: www.alexandernigeria.com

______________________________________________________________________