Document Type

Annual Report

Publication Title

Central Bank of Nigeria Annual Report and Statement of Accounts


This Report reviews the operations of the Central Bank of Nigeria (CBN) and macroeconomic developments during the fiscal year 2006 and appraises the major economic policy outcomes during the period. The Bank reported a stable foreign exchange market in 2006, with an average effective official exchange rate of N 128.65 per U.S dollar, an increase of 2.6% over 2005. The stock of external reserves, valued at US$12.30 billion, was 49.6% higher than in 2005, driven by high crude oil prices and lower debt-service burden. The reserves were equivalent to 28.4 months of import cover, exceeding the 6 months requirement under the convergence criteria of the WAMZ. The banking industry's soundness was assessed using the CAMEL rating, with 0 banks being sound, 12 being satisfactory, and 3 being marginal. The credit portfolio of banks improved as the ratio of non-performing loans to total credit declined to 8.7% from 9.3% in 2005. The financial system at end-2006 comprised the CBN, the Nigeria Deposit Insurance Corporation (NDIC), the Securities and Exchange Commission (SEC), the National Insurance Commission (NAICOM), the National Pension Commission (NPC), 25 deposit money banks, 750 community banks, I l2 finance companies, 322 Bureaux-de-Change, one stock exchange, one commodity exchange, 9 primary mortgage institutions, five development finance institutions, 103 insurance companies, seven microfinance banks, and 581 registered insurance brokers. Investment under the Small and Medium Enterprises Equity Investment Scheme (SMEEIS) increased by 41.4% to N 17.04 billion, with 52.8% of total investment going to the services sector.

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