- Stakeholders query forex, loans policies
- Apex bank means well for the economy – CBN
cross section of stakeholders in Nigerian banking sector have criticised recent policies of the Central Bank of Nigeria, CBN, arguing that they might be consciously or unconsciously demarketing banks thus frustrating them from delivering on the respective and collective mandate.
But spokesman of the apex bank, Mr. Isaac Okorafor argued otherwise, saying that the CBN meant well for the economy, the banks inclusive.
According to findings by Nigerian Pilot across the country, the Cash Reserve Requirements, CRR, handed down to banks, which is 31 percent as acceptable as it is, is being manipulated by the governor of CBN, Godwin Emefiele, whom they alleged made it 25 percent with the explanation that the difference of six percent was held back to “stabilise operations.”
One banker who did not see any reason for such a development said the move was killing too many banks’ operational efficiency.
Some bankers who volunteered information to Nigerian Pilot further alleged that there had been sinister but deliberate moves by the office of the governor of the CBN to “kill the banks” by subtly directing high net worth customers of some banks to close their accounts and move same to some other banks.
“That action smacks of demarketing. It is indirectly labeling some banks as distressed and that they could run under soon. So, telling some customers to move their huge accounts to other banks is telling them that anything could happen to those banks and deposits therein if the customers do no heed such advice,” said the banker.
On the issue of loans to customers, there were allegations that no bank gives out loans to individual or organisations without the approval of the CBN governor. They thus argue that such a policy, even if unwritten, constitutes a recipe for slowing down the economic progress employment of such loans by banks would engender.
Most of the respondents spoken to were also not happy over what they described as the apex bank’s recent policy of giving pilgrims special Dollar-Naira exchange, saying that decision was as discriminatory as it was against the run of play in the current foreign exchange regime.
Besides, they alleged that banks were being starved of dollars while they were directed to the black market to purchase it.
Put together, the respondent held that the foregoing policies of the CBN were killing the bank and creating a frustrating environment for operations.
“I am sure it is because the CBN governor is not an economist that is why he would not know the gravity of the distress his policies are causing stakeholders, especially the banks,” said a senior manager in a second generation bank in Lagos.
CBN means well – Okorafor
The CBN spokesman, however, debunked the allegations, attributing them to either ignorance of the operations and role of the apex bank or some deliberate ploy by some people to rubbish the good work being done by Emefiele.
On those calling for Emefiele’s head, the spokesman said, “Anybody calling for his head is wasting his time. Since the governor assumed duty and in this trying time, he has really put measures in place to keep the economy going and improving by the day.”
On the allegation on the dollar and black market, Okorafor added that it was false, saying the black market was there for anybody willing to patronise.
Though he accepted that dollars had been scarce, he said Nigeria sources its dollars from exports, remittances by diaspora Nigerians among others; and that the amount available was a factor of what comes in.
“The health of the banks therefore has nothing to do with the scarcity of dollars. We have no control over how much dollars comes into the country; people are talking now because many of them are going for vacation and they need the dollars as much as that can be. When they are not getting it, they talk this way.”
On the pilgrims special Dollar-Naira exchange rate, he said the presidency had already clarified the controversy.
He said payments for pilgrimages had been done by intending pilgrims long before now, before the new foreign exchange regime, adding that in 2015, a special exchange rate was also used for both Christian and Muslim pilgrims.
On the CRR, Okorafor said banks were entitled to take their risks, adding that it was only where they veer off approved guidelines that the CBN intervenes.
The apex bank’s spokesman said the bank meant well for all stakeholders in the industry, the Nigerian economy and the country, urging that doubts could easily be cleared from relevant personnel of the CBN.