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Igbinedion Urges Rethink on N25b Capital Base From Omon-Julius Onabu in Benin-City Governor Lucky Igbinedion of Edo State has advised the Central Bank of Nigeria (CBN) to have a rethink on the new recapitalization policy, which requires banks to have a capital base of at least N25 billion beginning from next year. The governor, who gave the advice yesterday while playing host to the new managing director and chief executive officer of the United Bank for Africa (UBA), Alhaji Aliyu Dikko, and a team of the bank's officials, opined that the new benchmark for banks was rather sudden and harsh and capable of triggering untoward economic consequences. He, therefore suggested a more gradual process of increase in the banks' capital base, instead of the sharp rise from N2 billion to N25 billion being introduced by the new CBN recapitalization policy, saying that would be more tolerable to the Nigerian economy. Igbinedion further recommended the adoption of different policies for different category of banks, pointing out that what was most paramount now, regarding CBN's efforts to sanitize the financial sector towards revamping the economy, was the reduction of the banks' lending rates. He reiterated his earlier view that funds accruing to the Federal Government should be deposited in banks for lending to industrialists, as a way of arresting the soaring interest rates charged by banks in the country which definitely diminishes entrepreneurial ventures and economic growth. Igbinedion maintained that the orchestrated efforts at Igbinedion by Nigeria would remain poorly rewarded "until the energy sector is stabilized," arguing that huge overhead costs - magnified by epileptic energy supply - acts as disincentives to investments in the real productive sector. Who Are We ? | About THISDAYOnLine.com | THISDAY People | Contact Us © Copyright 2000 Leaders & Company Limited

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