Dr. Samuel Nzekwe, a former President, Association of National Accountant of Nigeria (ANAN), has commended the Central Bank of Nigeria (CBN) for its plan to increase the minimum capital base of banks.
Nzekwe gave the commendation on Tuesday in Ota, Ogun State, during an interview with the News Agency of Nigeria (NAN).
NAN reports that the CBN Governor, Mr. Godwin Emefiele, on Monday in Abuja said that the apex bank was planning to raise the minimum capital base of banks from N25 billion to N230 billion.
The former ANAN president said that the apex bank’s decision was a right step in the right direction as it would create mega banks in the country.
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He said that banks in the country were granting short-term loans at high interest rates because of insufficient funds.
According to him, this makes it difficult for banks in the country to effectively perform their financial intermediation roles.
“There is no way the nation can develop when we do not have vibrant banks that could grant long-term loans to people,’’ he said.
Nzekwe said that the recapitalisation of banks from N25 billion to N230 billion would make people to have more confidence in the financial sector.
He said that this would also help banks to bridge the gaps of money that were taken from them through Treasury Single Account of the Federal Government. (NAN)