Nigerian banks’ deposits with the Central Bank of Nigeria under the Standing Deposit Facility declined to N82.99 trillion in August 2026, from N83.96 trillion in July.

The latest CBN financial data showed that the August figure represented the third-lowest monthly SDF placement by banks so far this year.

The Standing Deposit Facility allows banks to place excess liquidity with the CBN and earn interest on overnight deposits.

The decline came amid changing liquidity conditions and the reduction of the Monetary Policy Rate from 27 per cent in 2025 to 26.5 per cent in February 2026.

CBN data showed that banks deposited N89.3 trillion through the facility in June, N87.13 trillion in May and N92.32 trillion in April.

Deposits reached their highest monthly level of the year in March at N128.92 trillion, while February recorded N61.11 trillion, up from N52.6 trillion in January.

Despite the August decline, banks deposited an estimated N678.36 trillion with the CBN in the first eight months of 2026, representing a 610.58 per cent increase from the N95.47 trillion recorded in the corresponding period of 2025.

Vice-President of Highcap Securities, David Adnori, said the decline did not necessarily mean banks had become less liquid, noting that excess funds could have been converted into loans or securities or absorbed by the CBN.

Chief Research Officer at Investdata Consulting, Ambrose Omordion, said banks remained cautious about lending because of concerns over non-performing loans, while investment banker Tajudeen Olayinka attributed banks’ preference for CBN placements to high interest rates, credit risks and broader economic uncertainty.