ABUJA— PRESIDENT Olusegun Obasanjo yesterday warned bankers against politicising the on-going reforms in the banking sectors, declaring that anyone making such a move would be classified as anti-people and anti-progress.
However, the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) in the report of its study on the N25 billion minimum capital base for banks recommended the categorisation of banks into three— small banks to have N5 billion capital base, medium banks N15 billion; and large banks N25 billion.
Addressing the cream of the nation’s bankers at the opening of the 10th Annual Bankers’ Conference in Abuja yesterday, President Obasanjo said the reforms were not targeted at any particular bank or designed to create fresh crisis in the banking sector but to stem impending crisis and strengthen banks for more efficient services. His words: “I hope no individual or group will attempt to partisanly politicise the urgently needed reforms, otherwise such people would be classified as anti-people and enemies of progress.
“It would have been ridiculous for other sectors of the political economy to be subject to reforms and for the banking sector to be left out. Not only ridiculous, it would have been unrealistic. But the government believes that at the end of the exercise, we will be more focused
“The N25 capitalisation benchmark is not designed to penalise any bank, neither is it designed to precipitate crisis in the banking sector. We have over 40 banks or thereabout that have collapsed between 1990 and now. There is enough crisis in the banking sector.
“Instead of creating any more, we should prevent any more crisis in the banking sector. And that is what we are doing. If anything, the policy is designed to strengthen the sector and individual banks to empower the banks to restructure, redesign and recapitalise their mission in a rapidly growing economy and make them less susceptible to shocks. In addition, the reform is designed to reposition the banks to provide more efficient services to the Nigerian people by channelling credit to the real sectors of the economy.”
The president condemned the banks for trading with public funds without adding value to the nation’s economy. His words: “For the banking sector to be relevant to the goals of growth, development and social security, it must have, and must be perceived to have integrity, credibility, and honour. It is not ideal for an institution to call itself a bank when all it does is rely on funds from government which it then trades with without adding value to the economy or prompting growth.
“An institution that relies solely on currency trade and rarely gives loan to agriculture or industry in a decade cannot proudly call itself a banking institution. Worse still, in recent times, rather than create jobs, many banks have resorted to behaviour that smacks of social criminality—imposing unrealistic deadlines on young ladies and men compelling them into all sorts of anti-social conducts in order to meet such imposed targets and keep their jobs.”
NACCIMA wants categorisation
Meanwhile, the Nigerian Association of Chambers of Commerce, Industry Mines and Agriculture (NACCIMA), yesterday released the report of its study on the N25 billion minimum capital base for banks in the country, recommending that the Central Bank of Nigeria (CBN) should phase the minimum requirements into N5 billion for small banks, N15 billion for medium banks, and 25 billion Naira for big banks.
The association also recommended that the deadline for the banks to comply should be extended to two years, i.e. by December 2006 instead of December 2005 as earlier ordered by the apex bank.
