Buhari praises CBN, NDIC, SEC and others for financial system stability
President Muhammadu Buhari yesterday congratulated the Central Bank of Nigeria (CBN), alongside the Nigeria Deposit Insurance Corporation (NDIC), the National Insurance Commission (NAICOM) and the Securities and Exchange Commission (SEC), including other key stakeholders for the due diligence of the apex bank. work to ensure the stability of the financial system over the years.
Buhari, further assured that his administration will continue to support the entire banking and financial sector in all appropriate ways to ensure that it continues to fulfill its mandates while creating value innovation for customers.
The President presented the Commendation at the opening of the 15th Annual Banking and Finance Conference on the theme: “Repositioning the Financial Services Industry for a Changing Global Context”, held in Abuja.
Buhari, also said that the government is committed to protecting lives and properties in the country and will not relax the guarantee of a safe and secure environment for citizens as well as productive activities to thrive, noting that the threat terrorism and banditry were rampant in the country. over the years.
He said: “Indeed, the fight to rid our country of banditry, kidnappings and insurgency is intensifying on all fronts.
Further, on rising inflation, which continued to cause increasing hardship for Nigerians, the President assured that his administration had implemented several policies over the years to combat inflation, including an increase in monetary policy rates (MPR) as well as a reduction of 30%. increase in savings rates.
He said these policies were aimed at mopping up excess liquidity from the economy while encouraging savings and investment, stressing that the government would continue to cushion these adverse effects through its social safety net programs.
However, he said the government would continue to formulate and implement policies to promote self-sufficiency in critical areas such as energy, agriculture, health and technology, adding that the results of the conference would be valuable in shaping relevant policy initiatives.
Buhari, who was represented at the ceremony by the Minister of Finance, Budget and National Planning, Ms. Zainab Ahmed, pointed out that the CIBN annual conference, among others, provides a credible annual platform for review and holistic assessments of sector performance by industry practitioners and regulators while charting the course for the future.
This, he said, explains why his administration has always ensured that the government’s participation in the conference is at the highest level possible.
Buhari also expressed the need for a Nigeria of the future that harnesses its strengths, skills and cultural diversity to deal with current challenges plaguing the people, ranging from climate change to pandemics and insecurity.
Buhari, specifically noted that the theme of the conference was particularly relevant given the need to constantly adapt internationally acceptable best practices to improve the efficiency and effectiveness of the sector in its primary asset holding role. financial institutions, financial intermediation and capital formation.
He said the timeliness of discussions on repositioning the sector in a changing global context cannot be overstated, as it is likely to benefit from the experiences of other countries in navigating through emerging issues such as the fallout from the COVID-19 pandemic and the ongoing Russian-Ukrainian war which has global implications on the provision of financial services in local economies.
He said that under the new regime, the role and importance of the financial sector cannot be overstated in driving economic prosperity by providing opportunities for the creation of start-up SMEs, the expansion of existing business interests and the creation jobs, thus pushing the local brand overseas to frontier markets.
The President added that repositioning the financial services industry involves valuable innovations to ensure global solutions reach local Indigenous customers.
He said the recently signed African Continental Free Trade Agreement (AfCFTA) represented a typical benchmark, as the agreement creates a continent-wide market encompassing 55 countries with 1.3 billion people and a combined GDP of $3.4 trillion.
Buhari said the first phase of the regional trade deal, which entered into force in January 2021, would phase out tariffs on 90% of goods and reduce barriers to trade in services.
He pointed out that the financial sector would not only act as an intermediary for lenders and borrowers, but also to create a new ecosystem made up of platforms where ordinary Africans can buy and sell their locally made products despite the disparity in currencies such that it is practiced on the pan-African payment system. and Settlement System (PAPSS), a brainchild of Afrexim Bank.
Buhari, among others, noted that over the past seven years, his administration had, through various initiatives, supported the repositioning of the Nigerian economy in a changing “glocal” context.
He further listed the intervention measures to include support for Nigeria’s creative industry and indigenous small and medium enterprises as well as the agricultural sector which have enhanced the ability of indigenous businesses to compete with their counterparts in other country., adding that these efforts would be maintained and extended to other sectors of the economy.
He said addressing global issues in the local context would continue to boost the economic prosperity of local communities, adding that climate change, erosion of purchasing power due to inflation and insecurity are currently being addressed locally and globally.
However, in his remarks, CIBN Chairman Mr. Ken Opara said that the banking industry was not oblivious to the “brain drain or Japa syndrome” currently affecting the country’s workforce.
Accordingly, he said the development necessitated research on the topic “Analysis of Human Capital Attrition in a Changing ‘GLOCAL’ Context: A Case Study of the Nigerian Banking Sector”, adding that the CIBN would present the search result. work during the conference.
Opara said the COVID-19 pandemic had been a wake-up call for the financial services industry, revealing gaps in digital service provision and cost structures.
He said: “COVID-19 has proven to be a powerful catalyst for change. The digital transformation of the banking industry has accelerated beyond anyone’s imagination, as radical new ways of working remotely and serving customers facing difficult circumstances have been launched at a rapid pace. Mobile app transaction processing has exploded.
“Use of cash and checks dropped dramatically, replaced by high volumes of electronic and card payments. Business lending to keep the economy afloat was out of scale.
He said that as the world continues to evolve, the financial services industry should explore innovation and reconfigure its businesses and operating platforms, which in some cases requires making profound changes. to succeed in the future.
However, in his keynote speech, the Chairman of Union Bank of Nigeria Plc, Mr. Farouk Gumel, said the banking sector must help sustain the kind of growth that leads to inclusiveness, and accused operators of the financial system to embrace banking innovation at the expense of rural communities.
He criticized some banks’ ongoing conversations about the need to achieve operational efficiencies by closing branches.
Gumel argued that rather than closing branches, the best approach was to embrace the idea of reconnecting.
He said banks don’t really need a big structure, but rural branches targeted at rural communities to foster financial inclusion.
He said: “You have to be next to someone to convince them to trust you and I think that’s how the banking system should see it.
“Efficiency matters, but you have to be inefficient if you’re dealing with people in rural areas.”
He said there has been a disproportionate level of progress in the banking sector without consideration for the rural population who are often neglected.
Specifically, he called for increased credit support for underserved Nigerians to enable them to actualize their entrepreneurial aspirations.
Gumel, among others, also said that banking technology should not entirely replace human resources in the current model.