Dr. Olayemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), announced plans to request Deposit Money Banks to bolster their capital base in preparation for the projected $1tn economy outlined by President Bola Tinubu. Speaking at the Chartered Institute of Bankers of Nigeria’s 58th Annual Dinner, Cardoso stressed the need for sustainable and inclusive economic growth aligned with the administration’s ambitious economic agenda.
He emphasized the importance of evaluating the adequacy of the banking industry to serve the envisioned larger economy, citing the necessity for banks to have sufficient capital relative to the finance system needs of a $1tn economy. As part of this initiative, the CBN will direct banks to increase their capital.
Cardoso acknowledged the challenges in the banking sector, attributing negative perceptions to corporate governance failure, diminished independence, deviations from the core mandate, inefficient forex rules, and ventures into development financing. He highlighted the importance of prioritizing price stability and addressing fundamental flaws.
Addressing past quasi-fiscal activities, Cardoso revealed that his predecessor, Godwin Emefiele, injected over N10tn into the economy through intervention programs. He acknowledged the distractions caused by these activities and pledged to address institutional deficiencies, restore corporate governance, and implement prudent policies during his tenure.
The CBN Governor assured stakeholders of a concerted effort to restore macroeconomic stability, address institutional challenges, and promote economic growth. Despite challenges in the global and local economic environment, Cardoso emphasized the financial sector’s resilience in 2023, with plans to fortify the industry for future challenges.
In conclusion, Cardoso outlined corrective actions, strategic measures, and comprehensive policies aimed at achieving economic stability in the short-to-medium term. The speech touched upon issues related to the fluctuating exchange rate, forex policies, and the impact of various government measures on the economy.
