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...For a better society... Wednesday, July 14 2004 Vol 17 No.131 News Editorial Politics Opinion Features The Arts Sports Education Business Money/Market Travels/Tourism Property/Environment Columnists No going back on N25bn bank capital base-Soludo KENNETH MADUEKE CENdTRAL Bank of Nigeria (CBN) yesterday said that the N25 billion capital base recently prescribed for banks "is for the interest of the nation’s economy." CBN Governor, Prof. Charles Soludo, who justified this in Lagos during an interactive session with top journalists, insisted that the 18-month time frame for the exercise was enough for serious banks to accomplish. According to Soludo, the move is part of a 13-point agenda designed to ensure financial sector reform and consolidation. The apex bank governor, flanked by his three deputies, explained that "the motive behind the increase in capital base of banks (from N2 billion to N25 billion) is to give Nigeria a banking structure that is safe, sound and stable." "Such banking structure that would emerge at the end of December 31, 2005 deadline should be one whereby bank depositors can keep their monies and go to sleep", he said. He further stated that most of the 89 banks in the country today are mere rent centres who depend on parastatals’ accounts and foreign exchange (forex) to make cheap profits. According to him, "some of such banks are already weak and do not add value to the Nigerian economy and ought not be allowed to remain after December 31, 2005." The CBN governor said that Nigeria deserves banking sector that should be useful to the productive, real and agricultural sectors of the economy. He insisted that such banks must be reliable and ready to lend money to investors for purposeful investments as well as play the actual banking role of intermediation. Prof. Soludo said that by the time banks beef up their capital bases, "we should be able to have strong banks that could syndicate big facility and support the real sector." He noted that by December 31, next year, the apex bank will publish the names of healthy banks, a development which will send signals to the depositors on where to put their monies. � 2004 @ Champion Newspapers Limited (All Right Reserved). Powered By dnetsystems.net dnet�

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