The Central Bank of Nigeria (CBN) has assured the investing public that the exposure of banks to oil and gas sector is within manageable level as there is no cause for alarm. The apex bank said that from its routine examinations of the books of the banks, they are doing well and capable of meeting their obligations. Also, chief executives of banks rose on Thursday from the Bankers’ Committee meeting with CBN with a vote of confidence on the industry.
Addressing journalists after the first meeting in the year, the committee which included Tokunbo Martins, director, banking supervision, CBN; Segun Agbaje, managing director/CEO of Guaranty Trust Bank; Ladi Balogun, managing director/CEO, FCMB; Omar Hafeez, managing director, Citibank Nigeria Limited, and Ibrahim Muazu, director, corporate communication, CBN, said “in conclusion what we decided is that banks are sound, safe and resilient”.
Read also: World Bank gives $1bn in risk financing for African gas
This is based on the fact that the routine test con- ducted on deposit money banks shows that they are healthy. It has been widely reported that the banks might incur huge non- performing loans following their huge exposure to oil and gas as there has been a persistent drop in oil prices. Responding to this, Tokunbo Martins, director, banking supervision, CBN, explained that the capital level of banks is high enough to accommodate the unexpected.
‘’We do not have too much concern on that”, she said. The bankers’ committee discussed banks in terms of capital, capital adequacy ratio, in terms of liquidity, profitability and asset asset quality and came to a conclusion that all the ratios remain satisfactory, as all the banks were on average above regulatory minimum.
“It is encouraging to know that in spite of the headwinds globally and domestic that the banking industry remains sound and resilient”, the commit- tee said. On the issue of domiciliary account, the Bankers’ Committee unanimously agreed that there will be no change in the operation of domiciliary accounts, adding that there will remain unfettered access towards inflows of domiciliary accounts.
HOPE MOSES-ASHIKE
