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The Central Bank of Nigeria (CBN) has received praise from the Centre for the Promotion of Private Enterprise (CPPE) for carrying out the bank recapitalization program successfully.
CPPE said in a policy brief on Sunday in Lagos that 32 banks successfully complied with the increased capital criteria.
Dr. Muda Yusuf, the company’s chief executive officer, claimed that the improved capital foundation had not yet resulted in enough support for the actual economy.
He pointed out that while consumer and small and medium-sized enterprise (SME) lending levels were still low, private sector credit remained at roughly 17% of GDP, below regional and peer benchmarks.
Despite their crucial role in economic growth, SMEs only made up only 1% of all lending, according to Yusuf.
Concerns about short-term lending and unequal loan distribution across industries were also brought up by him.
He said that the expansion of credit was still hampered by high interest rates and rising government borrowing.
He advocated for legislative actions to increase loan availability and direct funds to profitable industries.
“The Central Bank of Nigeria deserves praise for a seamless and efficient procedure, and the recapitalization program has increased the resilience and stability of the banking system.
But the true test is how successfully the banking system facilitates enterprise, investment, job creation, and economic development.
At this point, economic impact should take precedence over capital strength. Nigeria needs banks that support the economy, not only stronger ones, he stated. [NAN]














