Banks battling with regulation, high compliance costs – Elumelu

…Calls for collaborative solutions

Tony Elumelu, group chairman of United Bank for Africa (UBA) Plc, has highlighted significant challenges facing Nigeria’s banking sector, including regulatory hurdles and high compliance costs, which he believes are impeding growth and innovation.

Speaking at the annual banking and finance conference organised by the Chartered Institute of Bankers of Nigeria (CIBN), Elumelu emphasised the need for constructive dialogue among government agencies, regulatory bodies, and banking institutions to foster a more collaborative environment.

“Our banking sector is a cornerstone of Nigeria’s economy. Its transformation over the last few decades is one of our success stories,” Elumelu stated. He praised the sector for employing millions, providing crucial financial support to businesses and generating income for shareholders. However, he warned that these achievements are threatened by rising compliance costs and regulatory constraints.

Elumelu urged stakeholders to work together to build a more resilient banking sector that can drive economic growth and support the aspirations of Nigerians. He underscored that the success of the Nigerian banking sector extends beyond the country’s borders. “Nigerian banks have become multinationals, leading the sector across Africa and establishing themselves in the world’s financial capitals. They have changed how our country is perceived and set themselves up as role models for other industries,” he noted.

Elumelu also called for measures to incentivise Nigerian youths to participate in driving economic growth. He stressed the importance of creating opportunities within Nigeria to prevent the country’s brightest minds from seeking opportunities abroad, often facing perilous journeys and family separations.

The UBA Chairman highlighted the role of Small and Medium-sized Enterprises (SMEs) in catalysing Nigeria’s economic progress during these transformative times. “By supporting businesses and creating an enabling environment, we can empower SMEs to be the engine of our economic growth,” he said.

Elumelu also addressed the pressing issue of insecurity, describing it as a national crisis that must be tackled decisively. “Our people deserve to go to their farms unhindered, live peacefully, and conduct their businesses without fear. It is the fundamental right of every citizen,” he declared.

During his keynote address entitled, ‘Accelerated Economic Growth and Development: The State of Play and the Way Forward,’ Elumelu outlined a strategy centered on three critical areas for shaping Nigeria’s economic future:

He argued that development is impossible without reliable access to electricity. He called for an energy ecosystem that attracts investment and unlocks the country’s economic potential. “Nigeria cannot industrialise, and our youth cannot be educated without ensuring our abundant natural resources are translated into plentiful, robust power for all,” he said.

He emphasised that a secure environment is essential for economic growth, urging for urgent and decisive measures to address the insecurity that has plagued many parts of Nigeria.

Elumelu called for a future where young Nigerians can realize their dreams within the country by creating value and wealth locally. He stressed the importance of supporting youth-led businesses and startups to foster innovation and drive economic development.

Supporting Elumelu’s views, Oliver Alawuba, group managing director of UBA Plc and chairman of the 17th annual banking and finance consultative committee, encouraged participants to transform the knowledge and strategies shared during the conference into tangible actions. “Our collective future depends on the steps we take today to innovate, collaborate, and drive progress,” Alawuba stated.

He urged all attendees to leave the conference determined to execute strategies that would build a financial sector capable of powering the economy, uplifting the people, and transforming the world.

At the conference, a consensus emerged among stakeholders that building a resilient banking sector was not just crucial for Nigeria’s economic growth but also pivotal in shaping the future of the African continent.