As the Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, pledged that the apex bank would continue to “play an active role in supporting the growth of our economy,” Events to watch out for this year in the banking industry include the following:
“Financial stability; development of a robust payments system that will increase access to finance for all Nigerians, thereby raising the financial inclusion rate; access to credit for not only smallholder farmers and MSMEs but also consumer credit ; mortgage facilities for bank customers and development of creative industry hubs,” according to Emefiele.
Creative industry hubs
So far , the Bankers’ Committee have announced that it would commence the redevelopment of the National Arts Theatre in Lagos, by this month, January 2020. Emefiele, stated this while making a presentation on the Bankers’ Final Briefing monitored on Channels Television Business Morning last week. He said the Bankers Committee has received presentations from the project consultants. After reviewing their presentations, including project numbers and details, set up a governance and trustee committee to oversee the process that would lead to the award of contract for the bid winners.
‘‘The contract award is expected to go through a competitive bid process and that jobs for the commencement of the renovation works for the National Arts Theatre as well as the building and development of a creative hub must start by January 2020’’.
In furtherance of its quest to make financial services more accessible and affordable to various stakeholders in the economy, the CBN also reviewed downward most charges and fees for banking services as contained in the new Guidelines to Charges by Banks, Other Financial and Non-bank Financial Institutions, with effect from January 1, 2020.
N1bn Bankers’ Charitable Endowment Fund
To make the society feel the impact of the banking industry, Emefiele, last November announced N1billion Bankers’ Charitable Endowment Fund to finance strategic social programmes across the country during the 54th annual Bankers’ Dinner of the Chartered Institute of Bankers of Nigeria (CIBN) in Lagos. He said the Endowment Fund, starting from this year, 2020, would bankroll a major charitable initiative every year.
“While several intervention initiatives will no doubt have attendant social benefits in communities, the Bankers’ Charitable Endowment Fund will directly fund strategic social programmes in states and local communities across Nigeria”, he added.
The 2020 initiative has been dedicated to the education of children in the impoverished communities across the country, according to Emeka Emuwa, the Chairman of the Ad hoc Committee on 2019 annual Bankers Dinner/ Group Managing Director/Chief Executive of Union Bank Plc.
According to him, this will enable the children and their families get on to the path of prosperity and enable them become more economically viable consumers.
He stated: “All bankers are used to competing for market share; fighting for customers. I think today we are coming together to do something that is not generating an income for ourselves. We are fighting; we are collaborating for a big cause. We are bringing education to the most impoverished communities by leveraging technology. We will do this in earnest by the first quarter of 2020. When you get education, you become a fuller human being and become a bigger and more robust consumers. If you look at it from that perspective, what we are doing and what we are trying to do is to build and increase the size of the banks, increase the number of customers with wealth. And then we can go back to be fighting for them. But, let’s first build them, let’s increase the size of the banks; let us educate these children wherever they are across the country, let us make them more economically equipped citizens.”
As for CBN priorities in 2020, Emefiele added: “Over the next year, we intend to support greater economic growth, price and exchange rate stability by engaging in the following measures;
“The current tight stance is expected to continue in the near-term, especially in view of rising inflation expectations. Though we will act to appropriately adjust the policy rate in line with unfolding conditions and outlooks, the CBN will continue to ensure that the policy interest rate is delicately set to balance the objectives of price stability with output stabilization.
“We expect inflation to rise slightly to about 11.7 per cent by the end of 2019 and then moderate thereafter, supported by our efforts at improving domestic production of staple food items; Though the CBN has so far managed to maintain exchange rate stability, the current capital flow reversals from emerging markets is expected to continue to exert considerable pressure on market rates. Notwithstanding these pressures, the CBN is determined to maintain its stable exchange policy stance in the near to medium term given the relatively high level of reserves.
“We intend to sustain access to finance efforts in 2020 as part of our plan to reduce our financial exclusion rate to under 20 per cent over the next year.
“We intend to address some of the barriers faced by non-oil exporters in producing goods for the export market. Working with the Nigerian Export Import (NEXIM) Bank, we will work to improve access to the N500 billion facility designed to support the growth of Nigeria’s non-oil exports. Part of our emphasis will be on increasing export of value-added goods relative to raw materials. Firms that have access to these facilities would be able to obtain loans at single digits. This would enable them to expand their production lines and improve the quality of their products, so that they can compete effectively with their peers from other parts of the world. Furthermore, in order to reduce the time lag required to export non-oil products, we have launched an automated NXP portal, which will reduce the time it takes to process critical export documents from two weeks to less than 10 minutes. This measure will support efficiency gains for firms primarily focused on the non-oil exports market.
“We believe by taking these actions, we can improve Nigeria’s non-oil export earnings from close to $2 billion in 2019 to $4 billion by 2020.”