|
CBN pegs bank owners�E
directors�Ecredit at 10%
Oluyinka
Akintunde, Abuja
The Central Bank of
Nigeria has barred insider borrowings by
banks�Eowners and directors above 10 per cent of
paid up capital.
The apex bank has also
proposed that the Bankers�ECommittee meeting
should be restricted to every four months
beginning from January 2005.
These
formed part of the decisoins at the
Bankers�ECommittee meeting held at the CBN in
Abuja.
The Director of Banking
Supervision of the Central Bank of Nigeria, Mr.
Ignatius Imala, who confirmed this in Abuja,
said that the Bankers�ECommittee approved the
recommendation of the CBN limiting large
exposure and connected lending by banks.
A credit institution�s exposure to a
client or group of connected clients is
considered a large exposure when its value is
equal to or exceeds 10 per cent of its own
funds.
According to Imala, the
implementation of the limits on large exposure
and connected lending by banks takes effect
immediately, while all outstanding exposures not
yet compliant with the limit are to be
regularised before January 1, 2005.
�The
Bankers�ECommittee has approved that individual
insider credit should not exceed 10 per cent of
a bank�s paid up capital, while the aggregate of
all insider credits should not exceed 60 per
cent of a banks�Epaid up capital, except with the
prior written approval of the CBN,�Ehe said.
Besides, he stated that banks�Eexposure
would henceforth not be more than five per cent
of the shareholders�Efunds.
�It is
recommended that large exposure in Nigerian
context would be defined as any credit that is
at least five per cent of shareholders�Efunds
unimpaired by losses.
�The five per cent
of the shareholders�Efunds unimpaired by losses
was considered to be more representative of what
could be regarded as a large exposure, as
against the 10 per cent in the European
countries,�Ehe stated.
He added that the
aggregate or total of large exposures of banks
should not exceed 800 per cent of its own funds.
Our correspondent gathered that
violators of the limit on insider credit risk
N100,000 fine or three years imprisonment.
Meanwhile, the Governor of the CBN,
Prof. Charles Soludo, has advocated that the
bi-monthly meeting of the Bankers�ECommittee
should be restricted to every four months.
�We may need to reappraise the frequency
of the meetings of the Committee. May be,
beginning from 2005 we could restrict the
general meetings to three times a year (that is,
every four months) while the subcommittees could
meet frequently,�Esaid Soludo, who is the
Chairman of the Bankers�ECommittee.
The Punch, Thursday July 08, 2004
|
|
|
Copyright 2003 - 2004 Punch (Nigeria)
Limited. All Rights Reserved
Powered
by dnetsystems.net dnet� | | |
|
|
 |
| STOCK
MARKET |
| As at Wed, July 07,
2004 |
 |
8,265
8,250
8,235 |
| Nestle |
 |
N175.00 |
+296k |
|
| NNFM |
|
N25.09 |
+119k |
|
| UBN |
|
N38.10 |
+113k |
|
| Total |
 |
N196.50 |
-950k |
|
| Guinness |
|
N157.32 |
-828k |
|
| Conoil |
|
N170.00 |
-260k |
|
Volume:
69.1million
Value: N957.1 million
Deals: 4,010
Index:
27,792.91
Mkt Cap: N1.987
trillion | | |
|
|
| AUTO WORLD
|
| |
|
 |
|
|
|
|
|
| | | |
