Financial analysts have stated that banks are on course to meet the deadline of March next year set by Central Bank of Nigeria to meet recapitalisation.
The Managing Director of Jaiz Bank PLC, Nigeria’s pioneer non-interest bank, Dr Haruna Musa, provided insights on the bank’s strategies for meeting the CBN recapitalisation threshold.
Though CBN’s recapitalisation threshold for national and regional authorisation for non-interest banks is N20 billion and N10 billion, respectively, Jaiz Bank CEO said his bank will go above the CBN recapitalisation threshold.
Speaking with Saturday Telegraph, Prof. Ken Ife , London Enterprise Ambassador & Chief Economic Strategist in ECOWAS Commission, said seven banks crossed CBN recapitalisation hurdles.
He said: “What I have to say about the re- capitalisation process is that, seven banks have cross hurdles among which are Access bank, Zenith bank, and Ecobank Nigeria.
“We also have the Lotus bank, Jaiz bank and GTB. In fact, the tier one banks have crossed it.
“The tier one banks are actually making great efforts to meet the N500 billion recapitalisation deadline.
“In the next six months, we will see a good number of them bring that home but don’t forget it is not going to be brutal as it was in 2005 when 81 banks whittled down to 22 banks.
“Here, it’s less of a hassle because there may be mergers and there may be takeovers, but it is not going to be as brutal as it was in 2005.”
Ife added: “I remain very optimistic because at the end of the day, N500 billion, looking at what it is in dollars today and comparing N25 billion to dollars in 2005, what it is in dollars terms, there isn’t much difference.
“I don’t see why it should be a big problem for these banks to cross the target but then most of them are going through Right Issues and they’re sensitising current shareholders to invest.
“The other one is public offering. So, on both counts, they are making progress and also attracting some foreign investment in that regard.”
Also speaking, Abuja-based Economist, Dr Ilyas Aliyu, said most of the banks are buoyant, adding they will scale through.
According to him, “even with the current economic challenges, most banks are making more money.
“Most of them have gone on selling shares. I’m convinced they will all scale recapitalisation hurdles with no one ready to merge.”
He added: “What I think the banks will do is to look at what they have with the CBN, get their shareholders to buy more shares, or do a private placement.
“I don’t see it as a challenge. I don’t see any bank unable to meet the recapitalisation threshold; the money is not beyond them to raise.
“Look at the rate of the dollar to the naira. Most of them have corresponding banks outside Nigeria.”
“CBN gave banks ample time to meet up. I don’t see any bank failing to meet up.”
