• Sunday, July 14, 2024
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BusinessDay

Incoming CBN governor challenged on forex reserves, credit, AMCON fund

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Banking industry stakeholders and shareholders of Zenith Bank Plc yesterday challenged Godwin Emefiele, Central Bank of Nigeria (CBN) governor designate to take urgent steps in creating a healthy relationship between customers’ deposits and loans the country’s banks give out. They also want him to look at the possibility of reviewing the 0.5 percent premium on profits paid by banks into the Asset Management Corporation of Nigeria (AMCON) sinking fund.

 The call is coming just weeks after Mustafa Chike-Obi, CEO of AMCON, expressed support for a proposed amendment to the AMCON Act, especially as it relates to contributions into the fund.

 Chike-Obi, at the Detail Business Series organised by Detail Commercial Solicitors in Lagos, said that the contribution should be legislated to make it binding and legal to guide against the possibility of change in policy by any other person that may not be interested in the contribution.

Also, the stakeholders at the bank’s yearly general meeting in Lagos yesterday, urged Emefiele who was attending the meeting for the last time as its chief executive, to take urgent steps to halt the dwindling foreign reserves and also right some of the perceived injustices against some shareholders in the area of recapitalisation and sale of the banks taken over by the CBN.

For instance, while Zenith Bank paid N17.6 billion premium into the sinking fund for the year ended December 31, 2013 against N6.5 billion in 2012, N1.8 trillion was mobilised from depositors as against N916.8 million that was given out as loans for the year under review.

Norna  Awoh, market analyst and shareholder of  Zenith Bank, Emmanuel Ikwe of Zonal Shareholders Association, Sunny Nwosu, Independent Shareholders Association, Muktar Muktar, shareholders Trustee, Farouk Umar,  Association for the advancement of the rights  of Nigerian shareholders, among others, were unanimous in their submissions that higher premium calls for review, as this will enhance dividend payout, while entrepreneurs be encouraged through loan facilities.

They challenged Emefiele to bring his wealth of experience, as well as his conservative disposition and adherence to rule of law and corporate governance to ensure that the CBN under his leadership becomes responsible and responsive.

 “We need answers to be provided as to why Nigerian banks keep reserves year in year out. Also the governor designate, we urge you to take a second look at 0.5 percent payment by banks into the sinking fund. It is too much and should be reviewed,” said Awoh.

 Speaking further, he said, “Mr. Governor you should equally see the possibility of creating relationship between deposit to loans, with a view to encouraging entrepreneurship. The pressure on the naira should also be looked into.”

 Ikwe said, “ the governor should ensure that all the wrongs meted out to people during the acquisition and sale of banks are redressed.”

 The CBN governor designate, while thanking the stakeholders for setting agenda for him, promised that he would not betray the confidence reposed in him.

 He urged them to extend same cooperation to his successor, Peter Amangbo.

 On the demands made with regard to the need to limit banks’ exposure to government, he said, “we will take a dispassionate look at all the issues, we will however  be fair, just and firm.”

 Norna  Awoh, an analyst and shareholder queried the 0.5 percent payment by  banks into AMCON’s sinking fund, saying that the new CBN governor should look into it with a view to reviewing it.

John Omachonu