Experts applaud CBN’s initiative to recapitalise Deposit Money Banks
In a recent development, financial experts have lauded the Central Bank of Nigeria’s (CBN) initiative to begin a new round of recapitalisation for Deposit Money Banks.
This commendation came during separate interviews conducted on Sunday in Ota, Ogun.
The CBN Governor, Mr. Olayemi Cardoso, announced the recapitalisation plan at the 58th Annual Bankers’ Dinner, which was held in Lagos and hosted by the Chartered Institute of Bankers of Nigeria.
This strategic move marks a significant step since the last recapitalisation in 2004, under the leadership of former CBN Governor Charles Soludo, who increased the banks’ capital base from N2 billion to N25 billion.
The former President of the Association of National Accountants of Nigeria, Dr. Samuel Nzekwe, has expressed his support for the decision, calling it a “welcome development.”
The recapitalisation effort is seen as a proactive measure to bolster the financial strength and stability of Nigeria’s banking sector.
Stakeholders in the financial industry are closely monitoring the situation, anticipating further details on the recapitalisation process and its implications for the banking landscape in Nigeria.
Nzekwe said that Nigerian banks needed to recapitalise because the country‘s currency had been devalued due to the rising inflation rate in the country.
According to him, the inflation is so high that what they have in the system might not be enough to back up any financial obligations that may come.
“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.
Former Director, Research Department of CBN, Dr Titus Okunronmu, 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.
