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CBN Will Compel Banks To Increase Lending This Year – Experts

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CBN and loans

The CBN had just launched a 60 percent loan-to-deposit ratio (LDR) for financial institutions, meaning that banks should offer 60 percent of their deposit as loans.

The CBN major motive is to stimulate banks to give out their surplus money instead of depositing it in their Standing Deposit Facility (SDF).

To be able to achieve this, Central Bank of Nigeria has decreased the maximum remunerable threshold for deposit placement by banks through the SDF from N7 Billion to N2 billion.

Experts at Vetiva Capital Management Limited have predicted 8.6 percent growth banks’ lending in 2019.

The company-based upgrade is spurred by latest policies implemented by Nigeria’s  apex bank, CBN to obligate banks to boost the economy through increased lending.

The forecast, unveiled in the direction of the firm for the second half of the year, reflects an rise of 4.8 percentage points from the company’s previously predicted development of 3.8 percent at the start of the year.

Indicating that it will be hard for banks to conform with the 60% LDR, experts at Vetiva Capital, moreover, estimated that extra legislation will be developed by the CBN to limit the impact of the lending policies on the efficiency of banks.

They said:

“We see little scope for fiscal reform in H2’19, with only the power sector proving to be the most likely; this is due to the Federal Government’s lag in setting up the new Federal Executive Council and an economic team, rather the introduction of new regulation by the CBN on Deposit Money Banks (DMBs) will prove to be the main driver for credit growth in 2019.

“The CBN recently issued a directive, mandating DMBs to attain a loan to deposit ratio (LDR) of 60 percent by September 30, 2019, with a loan book weighting of 150 percent on priority sectors – SMEs, retail, mortgage and consumer lending. The penalty on DMBs for non-compliance to the new minimum LDR is a cash reserve requirement levy of 50 percent on the lending shortfall of the target LDR.

“Consequently, DMBs under our coveragewill need to grow loans by 11 percent or N1.1 trillion to achieve the 60 percent LDR minimum. This will be difficult to achieve in our view, due to the weighting allocation directive for priority sectors. We, however, expect to see additional regulatory adjustments/additions to account for the potential impact on DMB Non Performing Loans (NPLs), capital adequacy and profitability. Accordingly, we have revised our Full Year 2019 outlook for loan growth to 8.6 percent from 3.8 percent previously.”

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I am Olarewaju, A university graduate, I love writing and delivering useful information for the major populace. An editor at NIGERIA NEWS, you can email me at olarewaju@nigeianews.net

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Ecobank Rids Lagos Streets From Dirty Plastic Bottles, Explains How You Can Earn From This Campaign

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Ecobank

Ecobank Nigeria has revealed the fruitful removal of more than two million plastic bottles from Lagos street corners. This is a campaign from the top bank to make Lagos clean by paying Lagosians N30 for every bottle picked.

The initiative, which began in May 2019, aims to remove at least four million bottles from the surroundings as part of the environmental protection strategy of the bank.

Speaking on the initiative, the Managing Director of Ecobank Nigeria, Patrick Akinwuntan, said:

“So far, we have succeeded in removing over two million bottles from the streets of Lagos. We hope to get to the four million targets we set for ourselves within the next few months. We are grateful to our partners who have been consistent in their push to achieve this target.

‘‘I want to use this opportunity to urge residents to take their used plastics to the Lagos sewage treatment plant in Amuwo Odofin and get cash instantly.

‘‘Plastic waste is seriously affecting our food, oceans, harming marine life and threatening our food chain. As a responsible corporate organisation, we will do all it takes to check the trend to ensure a safer living environment.”

Also speaking, Executive Director and Chief Risk Officer of Ecobank Nigeria, Biyi Olagbami, who is also the coordinator of the Cash for Plastic Initiative said:

“We appreciate the response we are getting from residents and we hope to sustain this effort in assisting to clean our environment.

“We may extend this initiative to other major cities in Nigeria in the future.”

The plastic waste for cash initiative is being implemented in collaboration with the Lagos State Ministry of Environment and Alkem Nigeria Ltd.

It is aimed at improving the environmental sustainability and community health development in Lagos by rewarding residents for every plastic bottle picked from the street.

The collectors are incentivised with N30 for every kilogram plastic bottle picked

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MTN Offers Financial Services To Recharge Card Sellers

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4G+ MTN Network

MTN Nigeria Communications Plc’s executives has revealed obtaining the CBN consent to provide financial services to Nigerians.

A report issued on Wednesday, by his scribe, Uto Ukpanah, said his affiliate, Yello Digital Financial Services Limited (YDFS), acquired the license to strengthen economic development in Nigeria.

According to the declaration, the telco will engage the services of its airtime retailers spread across the nation to provide customers with financial services, while others will be hired as agents.

The statement reads:

“MTN Nigeria Communications Plc announces that its subsidiary, Yello Digital Financial Services Limited (YDFS) has been granted a full Super-Agent Licence by the Central Bank of Nigeria (CBN).

“The Super-Agent licence enables the scale launch of MTN Nigeria’s fintech strategy. The licence will enable MTN Nigeria to convert their existing airtime agents and recruit other small businesses to distribute financial services,” 

MTN Nigeria explained that YDFS received approval in principle for its Super-Agent licence in December 2018 and has been conducting a pilot project since then to meet the conditions of a full licence.

“The successful pilot has now led to the granting of a full licence under the YDFS will distribute financial services to all Nigerians,”

“The Super-Agent licence enables us to extend access to financial services to a much broader group of Nigerians.

“This forms part of our commitment to contribute towards the achievement of Nigeria’s financial inclusion goals.”

“Through the network established by YDFS, MTN Nigeria is in a position to broaden the availability of financial services for the under-served across the country. This mars a very important first step in leveraging our infrastructure to scale our fintech initiatives.”

“We have also applied for a Payment Service Ban licence, which will enable us in time to offer a broader and deeper range of financial services to those communities and we remain hopeful we will receive approval shortly,” 

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