Dr. Olayemi Cardoso, the newly appointed acting CBN Governor must restore confidence in Nigeria’s Forex Markets, deepen the financial system, encourage efficiency in Nigeria’s financial system and suspend the naira redesign policy indefinitely.
This was disclosed in a statement by Dr, Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise in a statement shared with TheWitness.
They added that Dr. Cardoso is assuming the leadership of the CBN at a very crucial time in our economic history.
CPPE called for an imperative to deepen the financial intermediation role of the deposit money banks, which is their primary role in an economy.
They urged that the spread between deposit and lending rates in the Nigerian banking system is too high.
CPPE noted that the minimum capital requirements of the banking industry need to be reviewed in light of the considerable loss of value amid depreciating domestic currency.
CPPE noted that the naira redesign policy should be suspended indefinitely and it should not be a priority at this time.
Tenure and Cost of Funds in the Banking System
CPPE warned that the tenure of funds in the country’s banking system is extremely short as over 85% of deposits in the banking system are less than one year tenure.
They added that this is why there has been a dominance of development finance in the economy, citing a need to address the macroeconomic fundamentals to correct this maturity structure of funds in the banking system.
CPPE noted that Steps should be taken to reduce concentration risks in the banking system as a strategy to manage systemic threats to the bank system, adding that the top ten banks account for over 80% of bank assets, total loans, and deposit liabilities.
TheWitness reported last week that Dr. Cardoso together with his designated deputies took the oath of office on Friday, 22nd September 2023 at the bank’s Head Office in Abuja.
