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...For a better society... Wednesday, September 15 2004 Vol 17 No.30 News Editorial Politics Opinion Features Foreign News The Arts Sports Education Business Money/Market Travels/Tourism Property/Environment Columnists N25bn will create more jobs �CBN KOLA ADEPOJU, Abeokuta FEAR of possible job cuts on account of the N25 billion bank recapitalisation requirement was confirmed Monday by the Central Bank of Nigeria (CBN) even as the bank also said more jobs would be created in the long run. Justifying the bank reforms in Abeokuta, the Ogun State capital, CBN Deputy Governor, Mr. Tunde Lemo, said the measure would help check the colossal loss of jobs being caused by banks failure to lend to the real sector of the economy for wider development. He assured that once the banks were financially formidable enough to support the productive sectors of the economy, thousands of new jobs would be created, thereby dwarfing the totality of jobs lost. Lemo spoke while presenting a paper entitled: "Paid-up Share Capital Increase for Nigerian Banks-Effects on Customers and Patrons" at a public lecture organised by the Abeokuta Chamber of Commerce, Industry, Mines and Agriculture (ABCCIMA) held at the South West Resource Centre in the Ogun State capital. According to him, "the real question is whether more jobs will be lost under the present restructuring plan. The answer is no. We should think about the counter factual." "How many hundreds of thousands or millions of jobs are we losing each year because banks are not lending to the real sector of the economy? Such losses are indeed greater than the total employment opportunities in the banking industry," he added. "Think of thousands of new jobs that would be created when we have a sound banking system that supports the productive sector of the economy," he remarked. Lemo, who was represented by the Controller, CBN Abeokuta branch, Otunba Adekunle Ogunsanya, insisted that "if we fail to act now, more jobs will be lost if we liquidate the 11 banks that are already technically dead." Dwelling on why CBN opted for the on-going reforms, Lemo said the measure was aimed at avoiding the distress that is looming in the banking industry. Besides, he pointed out, it would encourage mergers and acquisition of banks, which would in turn shore-up their capital base to the extent that they would compete favourably with their counterparts especially in South Africa and elsewhere. The unfunding by the CBN of the fresh capital base requirement a few months ago was greated with mixed reaction by the finance commity. � 2004 @ Champion Newspapers Limited (All Right Reserved). Powered By dnetsystems.net dnet�

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