CBN To Increase Capital Base Of Banks
The Central Bank of Nigeria (CBN) has revealed intentions to increase the capital base of banks in the country.
In his speech at the 2023 Bankers’ Dinner on Friday, CBN Governor Dr Olayemi Cardoso stated that while there has been stability in the banking sector, banks in the country were not adequately capitalised to meet the need of a $1 trillion economy which the present government was aiming to achieve.
“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.”
He further stressed the importance of technology in delivering financial services and enhancing financial inclusion.
He spoke on financial institutions that have breached their licences regarding the use of technology to facilitate payment. According to Cardoso, the apex bank has noticed 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 stated.
“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.”
