Two financial experts praised the Central Bank of Nigeria’s intention to further strengthen the capital base of Deposit Money Banks. They shared their commendations separately during interviews with the News Agency of Nigeria in Ota, Ogun.
During the 58th Annual Bankers’ Dinner organized by the Chartered Institute of Bankers of Nigeria in Lagos, Mr. Olayemi Cardoso, the CBN Governor, unveiled plans for a new round of recapitalization for commercial banks.
The last time the CBN mandated banks to recapitalize was in 2004, under the leadership of former CBN Governor Charles Soludo, who increased their capital base from N2 billion to N25 billion.
Dr. Samuel Nzekwe, former President of the Association of National Accountants of Nigeria, lauded the apex bank’s decision to raise the capital base, considering the country’s currency devaluation due to escalating inflation rates.
Nzekwe highlighted the urgent need for Nigerian banks to recapitalize, citing the significant impact of high inflation on the country’s currency. He expressed concerns that the existing financial reserves might not adequately support forthcoming financial obligations due to the prevailing inflationary pressures.
“There is the need for banks to recapitalise so that they can continue to exist.
“In addition, they need to recapitalise a little bit so that they can be in strong fittings in case of any eventuality and problems,” he said.
The ex-ANAN president emphasised the need for banks to raise their capital base further to meet the challenges of the current time.
Dr Titus Okunronmu, former Director, Research Department of CBN, said that the CBN’s planned recapitalisation of banks was a step in the right direction.
Okunronmu said it would put the banks in a better position to grant credit to the public.
He added that this would also help them to face future challenges.
(NAN)
