The
Central Bank of Nigeria (CBN) will be refunding Cash Reserve Ratio
(CRR) to banks that fund projects in agriculture and manufacturing
sectors, its Director of Banking Supervision, Abdullahi Ahmad, has said.
Speaking
yesterday at the end of the Bankers’ Committee meeting in Lagos, Ahmad
said the outlook for the economy in 2018 is much better than 2017. The
CRR is a portion of banks’ deposits kept with the CBN.
yesterday at the end of the Bankers’ Committee meeting in Lagos, Ahmad
said the outlook for the economy in 2018 is much better than 2017. The
CRR is a portion of banks’ deposits kept with the CBN.
He
said the CBN has been very supportive to banks adding that banks should
be able to lend to companies that are doing new capital expenditures
and expansions to factories using some of their Cash Reserve Ratio (CRR)
at nine per cent. These, he added, are not short term loans but long
term loans of seven year loans, two year moratorium on principal.
said the CBN has been very supportive to banks adding that banks should
be able to lend to companies that are doing new capital expenditures
and expansions to factories using some of their Cash Reserve Ratio (CRR)
at nine per cent. These, he added, are not short term loans but long
term loans of seven year loans, two year moratorium on principal.
“It
would probably be the first time in the history of this country where
manufacturers would be able to take fixed interest rate loans for seven
years which means they would be able to plan. The volatility that they
fear for all kinds of risks would be taken out and I think these are
very laudable steps in improving and growing the economy,” Ahmad said.
would probably be the first time in the history of this country where
manufacturers would be able to take fixed interest rate loans for seven
years which means they would be able to plan. The volatility that they
fear for all kinds of risks would be taken out and I think these are
very laudable steps in improving and growing the economy,” Ahmad said.
For
him, the idea is to have job creating activities in the economy and
also to bring interest rate down. Although agric and manufacturing are
the initial sectors that are being considered, later on or now, a bank
can apply if there is a job creating sector that bank is operating in,
it may be considered.
him, the idea is to have job creating activities in the economy and
also to bring interest rate down. Although agric and manufacturing are
the initial sectors that are being considered, later on or now, a bank
can apply if there is a job creating sector that bank is operating in,
it may be considered.
“We
can refund the CRR of a bank that has engaged in lending in a new
project or an existing one in the agriculture or manufacturing sector as
a way of utilising the CRR. So, anytime a bank lends to manufacturing
or agric at the rate the CBN has prescribed, it would have its CRR
refunded up to the amount it has lend. The guidelines are coming up any
moment from now and once they do it take off,” he said.
can refund the CRR of a bank that has engaged in lending in a new
project or an existing one in the agriculture or manufacturing sector as
a way of utilising the CRR. So, anytime a bank lends to manufacturing
or agric at the rate the CBN has prescribed, it would have its CRR
refunded up to the amount it has lend. The guidelines are coming up any
moment from now and once they do it take off,” he said.
Also
speaking, Executive Director, Finance at First City Monument Bank
(FCMB) Mrs. Yemisi Edun, said the CRR that is taken from banks would be
positively deployed to grow the real sector as well as the agriculture
sector in the economy. “This is very positive for the economy and also
positive for banks because we would be able to access these funds and
earn on it. And because it would be coming at single digit rate, it
would be positive for the economy,” she said.
speaking, Executive Director, Finance at First City Monument Bank
(FCMB) Mrs. Yemisi Edun, said the CRR that is taken from banks would be
positively deployed to grow the real sector as well as the agriculture
sector in the economy. “This is very positive for the economy and also
positive for banks because we would be able to access these funds and
earn on it. And because it would be coming at single digit rate, it
would be positive for the economy,” she said.
“For
now, it would be channeled to agricultural sector and manufacturing but
it for growth expansions enhance creation of jobs. the focus it ensure
the economy grow now that we have achieved stability we need to now see a
positive trend of growth and that is what we are committed to do at
this time,” she said.
now, it would be channeled to agricultural sector and manufacturing but
it for growth expansions enhance creation of jobs. the focus it ensure
the economy grow now that we have achieved stability we need to now see a
positive trend of growth and that is what we are committed to do at
this time,” she said.
“We
have seen stability in the exchange rate being sustained, Gross
Domestic Product (GDP) growth higher than 2017 and although there are
capital reversals in our capital market, it is a little bit bearish but
the fact is that capital outflow in the Nigerian economy is far less
compared to many emerging economies is a sign there is high confidence
in the Nigeria economy,” Ahmad said.
have seen stability in the exchange rate being sustained, Gross
Domestic Product (GDP) growth higher than 2017 and although there are
capital reversals in our capital market, it is a little bit bearish but
the fact is that capital outflow in the Nigerian economy is far less
compared to many emerging economies is a sign there is high confidence
in the Nigeria economy,” Ahmad said.
