Governor of the Central Bank of Nigeria (CBN) Dr Olayemi Cardoso said the CBN will increase the capital base of banks in the country so they can meet the need of a $1 trillion economy which the present government was aiming to achieve.
In his speech at the 2023 Bankers’ Dinner on Friday, Dr Cardoso said while there has been stability in the banking sector, banks in the country need sufficient capital relative to the country’s financial requirements.
“Will Nigerian banks have sufficient capital relative to the finance system’s needs in servicing a one trillion dollar economy in the near future? In my opinion, the answer is no, unless we take action,” he said.
“Therefore, we must make tough decisions regarding capital adequacy. As a first step, the Central Bank will be directing banks to increase their capital.”
The CBN boss also stressed the importance of technology in delivering financial services as well as enhancing financial inclusion.
He also spoke on financial institutions that have breached their licences regarding the use of technology to facilitate payment.
According to Cardoso, the apex bank has observed that some institutions were operating outside the approved activities.
“Any intentional or unintended non-compliance will be subject to sanctions as operators have the responsibility to ensure that they are licenced for the activity they undertake,” he said.
“As we conduct a comprehensive review of the licencing framework for payment services, we will engage in extensive consultations to engage a new regulatory and compliance framework that is suitable for the technology-driven payment services sector.”
Dr Cardoso also weighed in on the 43 items previously restricted from accessing foreign exchange (forex) from the investor’s and exporters’ (I&E) window.
“During the period when the 43 items were restricted, there is a 51 per cent increase in trade evasion by importers accessing the foreign exchange market resulting in a revue drop of approximately $1.4 billion annually between 2015 and 2019,” he said.
