•Urges financial institutions to enhance lending to boost growth

•CBN disburses N370bn targeted credit facility to households, MSMEs

•Sanwo-Olu commends bankers’ committee’s COVID-19 response

Following the renewed threat of the COVID-19 occasioned by the new Omicron variants, the Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele has said banks should be prepared for policies that could upset their quest to make more profit for their shareholders.

Speaking in Lagos yesterday, he also appealed to members of the Bankers’ Committee to be prepared to lend their support to the country whenever the need arises as they did in the past under the umbrella of CACOVID.

This is just as he revealed that the CBN through its Target Credit Facility (TCF) had disbursed a total of N370 billion to households as well as micro, small and medium sized enterprises (MSMEs) in line with efforts to stimulate economic activities.

Emefiele said these at the 12th Annual Bankers’ Committee retreat with the theme: ‘Building Resilience for Economic Growth.’

The CBN had as part of efforts to cushion the devastating effects of the COVID-19 on households and firms introduced the TCF in March 2020, which has since attracted 800,000 beneficiaries till date with an outstanding of N30 billion still available for disbursement.

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“Yes, the economy is growing, inflation is moderating, we are beginning to see signs even in the midst of the third or the fourth pandemic, but I must say that whereas we see the green light at the end of the tunnel, I must say that the road ahead for us to get to the green light remains very rough.

“We will continue to crave your support to work with us because we will continue to come up with policies that in your own boardrooms you will find hurtful to your own quest to make more profit for your shareholders,” he said.

Emefiele who thanked members of the Bankers’ Committee said: “When COVID-19 broke, we called on the banks under the umbrella of CACOVID and the banking industry stood strong with the private sector and we did the little we could to help our country and to help our people to overcome the challenges of COVID-19.

“The banking industry constitutes a very important segment of the monetary policy and of government, even from textbooks that we have read in economics, banks constitute what we can call catalysts to growth in any economy.

“We called on you, we did several things appealing to you, it got to a point where I was beginning to appeal to say, look, how can we have a situation where the banking industry is growing, the banks are declaring profit but the economy is not growing well, or that our people are living in destitution and that it is not possible for us as bankers to live a comfortable life and yet in the midst of destitution and problems in our country.

“We did call on you and you rose to the occasion and you supported. I thank you, sincerely. I cannot say that central bank did this alone, everything that we have done since February 2020, realising your importance as a catalyst to growth in the economy has been with your support, I thank you.

“I must say, yes, the economy is growing, yes, inflation is moderating, yes, we are beginning to see signs even in the midst of the third or the fourth pandemic, but I’m most say that whereas we see the green light ahead of us at the end of the tunnel, but I must say that the road ahead for us to get to the green light at the end of the tunnel remains very, very rough.

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“We will continue to count that you rely and work with us to say that it’s not just about you making profit for your shareholders but it is also about you contributing to the growth of our economy even where there are some discomforts, you will play your part, stand strong and support the government and support the Central Bank of Nigeria to deliver a stronger and resilient economy.”

Also, Emefiele, while addressing participants at the retreat called on banks to enhance credit to critical sectors of the economy, stressing the need for the country’s Gross Domestic Product (GDP) to rise above five per cent annually, higher than its present average growth rate of 2.7 per cent.

Emefiele said: “Given our mandate to promote a sound monetary and financial system, and working with the fiscal authorities, the CBN took unprecedented measures to contain the effects of the pandemic on our economy and spurred increased productivity in key sectors.

“First, the CBN collaborated with the fiscal authorities to formulate strong policy support measures through the Economic Sustainability Plan (ESP) to restore stability and catalyse growth.

“In support of the recovery efforts, the bank deployed more than N3.5 trillion, which is about 4.1 per cent of Nigeria’s GDP, to support critical sectors including agriculture, manufacturing, healthcare, electricity, and construction. Other CBN policy measures that we took to help the economy recover included a reduction of the monetary policy rate from 13.5 percent to 11.5 percent to spur lending.

“The reduction of the interest rate on all CBN intervention loans from nine per cent to five per cent, extension of the moratorium on principal repayments for CBN intervention facility to March 2022, regulatory forbearance for banks to restructure loans to sectors severely affected by the pandemic and creation of a N400 billion TCF for households and small and medium enterprises. Of this, nearly N370 billion has been released to over 800,000 beneficiaries.”

Speaking further, the Emefiele also pointed out that a N1 trillion facility for local manufacturing and production in critical sectors of the economy was also established. On this, so far, 53 manufacturing, 21 agriculture-related, and 13 service projects had been funded from this facility.

In addition, he reiterated that a N200 billion healthcare intervention fund for pharmaceutical companies and healthcare practitioners was also established in the wake of the pandemic, to expand and strengthen the capacity of the country’s healthcare institutions and mobilise.

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Furthermore, he disclosed that the CBN mobilised key stakeholders in the Nigerian economy, under the Private Sector Coalition Against Covid-19 (CACOVID) team that raised N39.65 billion to tackle the scourge.

“Continued implementation of efforts to boost credit to productive sectors is required to sustain the recovery, quicken growth, and improve the livelihood of Nigerians.

“With population growth at about 2.7 percent annually, it is important that we continue to deploy measures that will enable our economy to attain faster and balanced growth rates of over 5 percent on an annual basis.

“In furtherance of these efforts and given current global realities, I enjoin and challenge this Bankers’ Committee Retreat to focus on fashioning out strategies to fortify the fabric of the Nigerian economy, boost growth and engender resilience especially to exogenous shocks.

“To spur growth, we will need to assess policy measures that can address subsisting imbalances and constraints to finance. This retreat should provide actionable steps to ensure that the Bankers’ Committee continue to make meaningful contributions to Nigeria’s growth and development,” he added.

Also, the CBN Governor outlined some of the policies the apex bank has undertaken in recent time to support the federal government in its job-creation as well as economic diversifican drive.

The he listed to include the 00 for 100 Initiative, under which targeted credit of up to N5 billion would be provided to 100 firms every 100 days.

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Selected firms would be those investing in Greenfield projects, significantly able to create employment opportunities, and use local raw materials. The initiative will also support firms producing goods for the export market.

“On the growth of the digital economy, the CBN is focused on building a robust payment system in Nigeria which is cheap, fast, efficient, and safe. With the growing pace of digitalisation globally, we will continue to leverage digital channels in fulfilling this objective.

“Reflective of the confidence in our payment system, between 2015 and 2020, about $700 million has been invested in firms run by Nigerian founders,” he added.

“The eNaira which is the first central bank digital currency in Africa and one of the first in the world, the eNaira will foster greater financial inclusion using digital channels, support cross-border payments for businesses and firms, and provide a reliable channel for remittance inflows into the country.

“The eNaira will ensure that Nigerians in remote areas can conduct financial activities using their digital devices at little or no cost,” Emefiele said.

In his address at the retreat, Lagos State Governor, Mr. Babajide Sanwo-Olu commended the CBN and the Bankers’ Committee over their policy response and monetary support to spur growth in the economy as well as in fighting the pandemic.

Sanwo Olu said: “I’m expecting that the retreat is not only strategic by providing a platform for all of you to review the various monetary policies and all the intervention program and to provide an opportunity for you to know what the New Year would have for all of us.

“It’s also very appropriate that at this time I commend and thank the leadership of the CBN and Bankers’ Committee in the way and manner that you’ve all stood up and addressed this challenging situation.”

Thisday