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Appraise your real sector customer loan requests – CBN tells banks

By on January 14, 2016

In line with the decision reached at the last monetary policy committee meeting (MPC) to channel the liquidity that arose from the reduction of the cash reserve requirements (CRR) to 20 per cent, to employment generating activities in the economy, the Central Bank of Nigeria (CBN) has directed commercial banks to appraise the loan requests of their customers operating in the real sector.
Specificifically, the central bank asked banks to appraise the loan request of their customers relating to the agricultural value chain, manufacturing, mining and solid minerals, infrastructure and other real sector-related projects, and forward same to it for final approval and disbursement of funds to those concerned.
The CBN stated this in a circular titled: “Reduction in CRR to Enhance Banks’ Liquidity for Real Sector Financing,” that was posted on its website yesterday. The circular was signed by the Director, Financial Policy and Regulation Department, CBN, Kelvin Amugo.
The MPC had at its 104 meeting held on November 23rd and 24th, 2015, reduced the CRR by 500 basis points, from 25 per cent to 20 per cent with a view to channelling the liquidity arising therefrom to the real sector.
“The reduction is part of the bank’s initiatives towards stimulting output growth, expanding the industrial base, diversifying the economy and increasing the accretion of the foreign exchange. To give effect to the policy thrust, the CBN is introducing measures to ensure that funds realised from the reduction of CRR are applied strictly to qualifying projects.
“Consequently, deposit money banks are henceforth required to appraise their their customers’ loan , request relating to the agricultural value chain, manufacturing, mining and solid minerals, infrastructure and other real sector-related projects and forward same to the CBN for final approval and disbursement. It should be noted that trading activities and refinancing of projects are not encoed under this programme'” the central bank stated.
The CBN Governor, Mr. Godwin Ifeanyi Emefiele, had at the Novemver 2015, MPC meeting, said the committee was concerned about the state of unemployment in the country.

 

[ThisDay]