CIBN urges banks to deploy fresh capital to MSMEs as Nigeria targets $1 trillion economy

The Chartered Institute of Bankers of Nigeria (CIBN) has called on Nigerian banks to deploy their recently raised capital towards financing micro, small and medium-sized enterprises (MSMEs), saying increased lending to the sector is critical to achieving stronger economic growth and Nigeria’s ambition of building a $1 trillion economy.

The President and Chairman of the Council of the CIBN, Dele Alabi, made the call at the world press conference on the institute’s 19th Annual Banking and Finance Conference, scheduled for 8-9 September at the Congress Hall, Transcorp Hilton, Abuja.

The conference, themed “Building a Resilient Economy in an Era of Disruptions: Strategic Imperatives for the Banking and Financial Services Industry,” will bring together policymakers, regulators, financial institutions, development partners, technology innovators, academics and business leaders to deliberate on the future of the banking and financial services industry.

$1 trillion economy

Speaking during the question-and-answer session, Mr Alabi said the recent recapitalisation of banks had provided stronger buffers for their balance sheets. Still, he argued that the additional capital should now be deployed towards productive sectors of the economy rather than remaining concentrated in government securities and large corporate borrowers.

“Capitalisation provides a buffer for shocks. It insulates banks’ balance sheets, but it does not stop there,” he said.

According to him, the banking landscape has changed significantly, particularly as declining interest rates and tighter borrowing margins among top-tier companies reduce the attractiveness of the traditional approach to deploying bank funds.

“Smart bankers, smart bank CEOs have to think of a more ingenious way of utilising this capital. Capital is not…