Olayemi Cardoso [Credit: The Guardian ]
The Association of Corporate and Marketing Communication Professionals of Banks (ACAMB) has commended the Central Bank of Nigeria (CBN) for its new recapitalisation measures aimed at strengthening Nigerian banks.
CBN raised minimum capital requirements for commercial banks to ₦50 billion, ₦200 billion, and ₦500 billion for regional, national, and international licences, respectively.
The aim of the new recapitalisation requirements is to make the banking sector stronger and more viable.
Rasheed Bolarinwa, the president of the association, in a statement in Lagos, said recapitalisation exercise would position Nigerian banks to strengthen the economy; expand the real sector, and build bigger globally competitive brands.
He commended the regulator for segmenting the minimum capital base for different categories of banks to give them level playing fields.
He said the association particularly noted the distinctive definition of the new minimum capital base for each category of banks as the addition of share capital and share premium.
He added that this was different from the previous use of shareholders’ funds.
“As it stands, banks are on the same page. And as such, there is no need whatsoever for any fear, as the banks have the capacity to meet the recapitalisation in line with allowable options stipulated by the apex bank,” he said.
Mr Bolarinwa explained that the association had backed other stakeholders in giving support to the announcement for recapitalisation by CBN governor, Yemi Cardoso.
According to him, this support underlines ACAMB’s belief that while Nigerian banks are globally regarded as safe, resilient and thriving; there is always room for growth.
“As Nigeria seeks to aggressively unlock its innate potential to become a global emerging economy, banks must also stand ready to play their crucial roles of financial intermediation.
“The CBN circular on review of minimum capital requirement for commercial, merchant and non-interest banks over the next 24 months has laid to rest any anxiety about the intention, process and possible outcome of the new recapitalisation exercise.
“The import of the recapitalisation announced is that Nigerian banks are safe and reliable but the apex bank in its developmental mandate, is leading the banks to strengthen their capacities to meet competitive domestic and global financial needs.
“This overarching theme that runs through the circular and its explanatory notes further affirms the soundness of the banking sector, in line with several rating reports on Nigerian banks by leading local and international rating agencies.
“We commend the CBN for the thoughtfulness it has put into the announced modality for the recapitalisation,” he said.
Mr Bolarinwa said the recapitalisation was a win-win for the Nigerian banks, the financial market and the economy.
He said the Nigerian capital market, where banks were the most influential group, had the depth to meet the capital requirements of banks.
He added that the extended timeline, until 2026, provided ample opportunity for all banks to follow through the recapitalisation plan without undue crowding effect.
“With their background of good returns and liquidity, banking stocks are toasts of domestic and foreign investors.
The ACAMB boss assured that the banking industry will continue to work with financial authorities to build up the economy.
“This recapitalisation will put Nigerian banks in better stead to support the strengthening of the economy; the expansion of the real sector, and the building of bigger banking brands that can compete continentally and globally.
“Banks will continue to cooperate with the CBN in the implementation of the recapitalisation programme.
“ACAMB shall also be engaging all stakeholders in order to ensure balanced and factual representation as the recapitalisation progresses.
“ACAMB reassures all depositors and shareholders to keep about their businesses with the Nigerian banks without fears,” he said.
(NAN)
