The Central Bank of Nigeria (CBN) has insisted that the success of the banking sector recapitalisation exercise will be measured by the ability of stronger banks to finance the real economy.
Speaking at the 38th Finance Correspondents Seminar in Abuja, the Deputy Governor of the CBN on Corporate Services, Muhammad Sani Abdullahi, explained that the banking sector needed to channel its increased financial capacity into productive sectors, including agriculture, manufacturing, services and infrastructure.
‘The wider economy should see the benefit over time. Agriculture, manufacturing, services, and infrastructure need finance suited to their cash flow and investment varieties,’ he said.
The Deputy Governor stated that smaller businesses and households also needed dependable payment services and appropriate financial products.
Abdullahi said stronger bank balance sheets should translate into wider access to finance and better services for customers, including those in rural communities, women and young entrepreneurs.
He therefore charged businesses to improve corporate transparency, governance and sustainability to enable them to access credit more effectively.
Abdullahi said the apex bank would continue to focus on governance, consumer protection, cybersecurity, data protection, reliable payment services and business continuity.
He explained further that the CBN’s supervisory approach would also emphasise risk-based market surveillance and enhanced stress testing.
‘Consumer protection and financial inclusion are integral to resilience. A system that people can access, understand, and trust will better support inclusive growth,’ Abdullahi said.
The Deputy Governor also called on financial correspondents and business editors to continue providing accurate and objective reporting on developments in the financial system.
He said the media remained an important link between policymakers, financial institutions, investors and the public.
Also speaking, Michael Akuka, Director of Corporate Communications and Investor Relations at the CBN, said the focus had shifted from whether banks could raise capital to how the additional capital would be deployed.
‘The question has changed. It is no longer whether the banking sector can raise capital, but what a better-supervised banking sector does with the additional capital,’ Akuka said.
Akuka noted that stronger balance sheets should enable banks to absorb shocks, support real economic activity and maintain public confidence.