The Central Bank of Nigeria (CBN) has taken another major step toward strengthening the country’s economy by reducing its financial exposure to the Federal Government while expanding its total assets to more than N138 trillion in 2025. The latest audited financial statements show the apex bank is gradually moving away from excessive government financing, a policy shift that aligns with Governor Olayemi Cardoso’s commitment to restoring monetary discipline, improving transparency, and rebuilding investor confidence in Nigeria’s financial system.
According to the CBN’s 2025 financial report, claims on the Federal Government through debt securities dropped from N26.74 trillion in 2024 to N26.40 trillion by the end of 2025. The bank attributed the decline to lower Ways and Means advances, the controversial overdraft facility that previously exceeded statutory limits and attracted criticism for fueling inflation. At the same time, the CBN’s balance sheet expanded significantly, with total assets rising by 18.1 percent to N138.66 trillion, reflecting stronger financial positioning despite a modest reduction in direct government financing.
The report also highlighted encouraging improvements in Nigeria’s external reserves, which climbed from $40.19 billion to $45.75 billion during the year, providing nearly nine months of import cover. However, despite the stronger reserve position, the country’s net foreign assets slipped slightly as liabilities to non-residents increased. Financial experts say this illustrates that while Nigeria has strengthened its foreign exchange buffers, external financial obligations remain an important challenge that policymakers must continue to manage carefully.
Governor Olayemi Cardoso said the bank’s reforms have already begun delivering positive results. He noted that tighter monetary policies, foreign exchange market reforms, and greater transparency have contributed to improved exchange rate stability, declining inflation, and increased investor confidence. Nigeria’s economy expanded by 3.87 percent in 2025, while headline inflation eased to 15.15 percent in December—the lowest level recorded since November 2020. The CBN also credited reforms such as the Nigerian FX Code, the Electronic Foreign Exchange Matching System, banking sector recapitalisation, and the Non-Resident Bank Verification Number (NRBVN) platform for strengthening the country’s financial system and attracting greater participation from international investors and the Nigerian diaspora.
Looking ahead, the CBN projects Nigeria’s economy will grow by 4.49 percent in 2026, driven by continued foreign exchange reforms, tax reforms, banking sector recapitalisation, and gradual monetary easing. Analysts believe the latest financial statements reinforce the bank’s transition away from quasi-fiscal interventions toward a more conventional central banking model. While stronger reserves and reduced government financing are seen as positive signs for economic credibility, experts caution that managing external liabilities will remain critical to sustaining Nigeria’s long-term economic recovery and financial stability.
source: Business day
