Home News CBN ORDERS BANKS TO ACCESS COVID–19 LOAN

CBN ORDERS BANKS TO ACCESS COVID–19 LOAN

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The Central Bank of Nigeria (CBN) has ordered commercial banks to critically assess their loan exposure to different sub-sectors while continually leveraging technology.

The CBN Governor, Godwin Emefiele spoke on the theme: ”Role of Financial Markets in the Nigerian Economy Post-COVID-19″over the weekend at the Financial Market Dealers Association (FMDA) annual conference in Lagos.   according to TheNation.

Emefiele, represented by CBN Deputy Director, Financial Markets Department, Patrick Ajani, stated that the banks and other financial markets participants have been directed to “now critically assess their exposure to different sub-sectors while continually leveraging technology to support their business operations and continuity”.

He also requested banks to evaluate their third-party provider risks, which include enterprises that are part of the value chain of sectors that the banks fund.

He said: “Market participants must collaborate closely to build back better. This will promote economic of scale and enhance synergy. Resilience in funding markets was also greatly tested during the pandemic which led to large-scale interventions by the CBN as qseen in the targeted credit facility, moratorium, interest rebate, household and mortgage loans and regulatory forbearances by both the fiscal and monetary authorities to preserve the markets and ensure stability.”

He mentioned that the apex bank was well aware of the pandemic concerns that had caused unprecedented global economic disruptions.

The bank Governor said, “Since December 2019, despite containment and lockdowns and interventions, we saw economic recession due to the health-induced global crisis. At the onset of the pandemic, the financial market was uncertain of its length and severity.”

Emefiele stated that at the start of the pandemic, the financial industry was in a strong position, as seen by stronger capital and liquidity levels, as well as the continued implementation of regulatory reforms such as the Loan to Deposit Ratio (LDR) policy

“Nonetheless, there are some remarkable threats in the markets including the reversal of the dominance of sovereign securities, drop in the yields of government securities and slowdown of funds to the equities market.

“Therefore, in a world that is constantly evolving, especially in terms of technology, corporates and businesses must adopt these services to leverage on these applications and technology in providing financial services to their clients,” he said.

Emefiele said the introduction of vaccinations has boosted the chance to invest in the financial markets, boosting confidence in the system.

 

Photo:. Godwin Emefiele, CBN Governor

 

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