As part of the public-private partnership initiative, the Federal Government on Tuesday engaged the Central Bank of Nigeria (CBN) and the bankers’ committee in bridging infrastructure gap through financing of four roads’ construction.
Consequently, the committee has set up a subcommittee among the bank CEOs to work with the CBN in identifying the roads and coming up with a framework to share with the government for a go-ahead.
“The government has invited the committee of bankers to also consider the possibility of Public-Private partnership (PPP) in bridging the infrastructural gap and it is to that extent that the committee considered coming in to see how we can finance about 4 roads,” Bello Hassan, the newly appointed director for banking supervision said this after the bankers committee meeting in Lagos Tuesday.
Also speaking on this, Hamda Ambah, managing director/CEO, FSDH Merchant Bank Limited, said: “we all agreed that government alone cannot provide all the infrastructure in the country; that we in the private sector have to work hand in hand with government to ensure that the infrastructure that this country needs to move ahead is provided”.
Another issue raised at the meeting was the Loan-to- Deposit Ratio (LDR) where it was disclosed that most of the banks have met the 60 percent LDR and are pushing to complete the reimaging 5 percent by the end of first quarter 2020.
Segun Agbaje, managing director/CEO of GTBank spoke on this, saying, this has been one of the most successful things that was done in 2019 when looked at how much credit that was availed in six months’ period.
Consumer credit has grown very well, he said. Retail or consumer credit accounts for 10 percent of banks’ books.
“The corporates who have always had credit have also been availed more credit and for any economy to grow the SMEs and retail segment must be availed with credit and I think the LDR is doing that very well. I think most banks are closed to 60 percent which as the director said we will push to try to get ourselves the remainder of the five percent between now and the end of the first quarter and maybe at the worst by half-year,” Agbaje said.
Meanwhile, the bankers’ committee has raised the paid-up capital of Nigeria Incentive-Based Risk Sharing system for Agricultural Lending (NIRSAL) from N5bn to N7.5bn, with an additional N2.5bn.
What this means is that the paid-up capital will enable the bank to promote expansion of branches across the country.
The branches will be used as a tool for financial inclusion and economic development,” Abubakar Abdulahi Kure, acting managing director NIRSAL MFB, said.
Already the NIRSAL Microfinance Bank has disbursed N18 billion from the Agri-Business/Small and Medium Enterprise Investment Scheme (AGSMEIS) fund to about 5000 applications across the country.
Hassan Usman, managing director Jaiz Bank, said the bankers’ committee was looking in many ways to support the government and the society whether it is increasing the level of credit to the private sector and real sector of the economy or working with NIRSAL and other banks to increase financial Inclusion or specifically intervening in infrastructure. These are steps being taken to ensure that the government is supported is the drive to grow this economy, reduce unemployment and also improve the security of the nation.