The Chartered Institute of Bankers of Nigeria has announced its support for the ongoing banking recapitalization exercise noting that it will empower banks to lend more to the key sectors of the economy.
This was disclosed by the CIBN, President, Dr. Ken Opara during his speech at the annual lecture of the institute in Lagos, with the theme “Improving Availability of Credit in the Nigerian Real Economy: The Critical Importance of Liquidity” on Tuesday, according to the vanguard.
Okpara pointed out that in comparison with their key role in stimulating economic growth, the volume of loans to actual sector activities such as agriculture, manufacturing, and services is comparatively small.
He said, “I propose that we consider offering more credit to these key sectors, particularly the agriculture sector. It is for this reason that the Recapitalization exercise is a welcome development. The recently announced upward review of the Minimum Capital Requirements of Nigeria by the Central Bank of Nigeria would further empower banks to extend more credit to the economy’s productive sectors.”
In addition, he stressed the need for the government to improve infrastructures in power, roads and the ease of doing business to solve some of the problems in the sector.
He notes “The government needs to improve further the ease of doing business and infrastructural development, such as power, roads and rail networks, etc.
“Setting up industrial centres where these companies can co-habit and share common infrastructure. Harmonize and reduce the various taxes and levies, including locating them in a single hub.
“Banks need to be deliberate in de-risking these companies via Capacity building programmes, and Advisory services.”
