We are reforming banks for economic stability, says Sanusi

THE Governor of the Central Bank of Nigeria (CBN), Mr. Sanusi Lamido Sanusi, yesterday, defended the measures taken by the apex bank to remedy the weakness in the Nigerian Financial System.

In a paper delivered yesterday in Lagos on “Sustainable development in the Nigerian Financial Services environment”, he explained that the global financial crisis, post consolidation weakness in the Nigerian financial system, occasioned by poor risk management activities in some Nigerian banks necessitated the remedial measures taken by the CBN.

Sanusi, represented by Head, Financial Policy and Regulation, Mr. Chris Chukwu, at the yearly International Education Conference of the Chartered Insurance Institute of Nigeria (CIIN), said that the apex bank had no option than to take the steps it took because of the prevailing circumstance, he said, adding that the ongoing reforms were imperative for the stability of the Nigerian banking system in particular and the financial system in general.

According to him, sustainable economic development was attainable with the existence of sound, efficient and stable financial system, as well as macroeconomic and financial stability.

He said: “While it is desirable to ensure stability of the system, it is quite imperative to nip perceived distress in the bud and this is the reason the CBN had to stretch itself to sustain the continued existence and effective functioning of the intervened banks in the hope that stakeholders will realize and work towards their resuscitation. The result so far has been quite encouraging and we shall remain focused and committed to our goal of facilitating a stable financial system that will fast track economic development on a sustainable basis.”

Sanusi said that since the path to sustained growth in the Nigerian financial environment lies squarely on the shoulders of an efficient and effective financial system, “we strongly believe that the measures taken by the CBN to correct the anomalies observed in the banking system, and the co-operation of other key stakeholders like the insurance industry and the institute will ultimately set the economy on the path of sustainable development”.

The President of the Institute, Mr. Sunny Adeda, in his address, said that the state of infrastructure in the country remains a major challenge to sustainability,  he said, adding that, “this has continued to constitute cause for concern for us as an industry”. The attendant risks in poor and insufficient infrastructural facilities such as roads, water supply and transportation cannot be over4emphasized. As an industry, he said, “we should begin to champion constructive campaigns for the development of the nation’s infrastructural base”.