Loan-to-Deposit Ratio (LDR) policy was introduced to:
ALimit foreign borrowing
BEncourage banks to lend more to the real sectorCORRECT
CReduce branch openings
DRaise dividends
CIBNBanking Principles
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Why the answer is B, and why the others tempt you.
CBN's LDR (currently 65%) compels banks to lend out at least a minimum share of their deposits — pushes real-sector financing.
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