Nigerian economy records 6.4 per cent Q1 growth rate

A session of the Federal Executive Council

Nigerian economy records 6.4 per cent Q1 growth rate
Uche Aneke and Hauwa Noroh Ali, Abuja

A report presented by the Central Bank of Nigeria (CBN) at the Federal Executive Council meeting shows that the Nigerian economy witnessed a 6.4 per cent growth rate in the first quarter of 2011 as against the year's overall expected growth rate of 7.4 per cent.

The FEC meeting presided over by the Nigerian president, Goodluck Jonathan, deliberated on a number of policies which were strategic to the growth of the Nigerian economy and other socio-sectors.

The CBN, Governor, Sanusi Lamido, led the council in the deliberation with his report which focused on the growth of the nation’s economy in the first and second quarter of 2011 and the global international economic environment under which the bank’s assessment was made.

Specifically, the reports focused on economic performance in the nation’s agricultural sector, manufacturing, oil production, oil prices, interest rates, foreign reserves movement of inflation and reforms in the financial sector.

Addressing reporters at the end of the meeting, Nigeria’s Minister of Information, Mr Labaran Maku, said that the apex bank had set aside September 30 as a deadline for the recapitalization of all distressed banks in the country.

He said the CBN had stepped up its efforts in collaboration with some international investors to ensure that the distressed banks met the September 30 recapitalization deadline.

The council also approved the introduction of cashless economy through e-banking in Lagos state and mobile banking which has the potential of bringing down the cost of running banks by 30 per cent and equally enable people in the rural area to participate in the rural sector.

The council also approved the enactment of an act for the amendment of Education national minimum standards of institution’s act and other related matter.

The Minister of Education, Mrs Ugadu Ahmed Rufia Said that the act was intended to empower the University Commission to sanction illegal universities in Nigeria.

The recapitalisation process

Earlier on Tuesday, the CBN said four banks had signed Transaction Implementation Agreement (TIA) with various core investors ahead of the recapitalisation deadline.

The CBN Director of Banking Supervision, Mr Joe Adewale, made this known while addressing reports on the outcome of the Bankers Committee meeting held in Abuja.

“The recapitalization programme is on course and indeed one of the intervened banks has been able to cross the major threshold in its recapitalisation plan and that is the Oceanic International bank which has just signed the Transaction Implementation Agreement.

“This brings to four the number of such intervened banks that has crossed that threshold,’’ Adewale said.

The four banks, he said, were Union Bank PLC, FINBank, Intercontinental Bank PLC and Oceanic Bank PLC.

He had also said that with Oceanic bank’s signing of the TIA, the interbank transaction deadline of September 30 would be extended to December 31, 2011.

“Indeed, about 80 per cent of such deposits has just been resolved and we are sure that the deadline of Sept. 30 of all the intervened banks to recapitalise, all issues will be resolved and all banks in the system will be adequately capitalised, adding that that no depositor will lose his or her money come what may and the CBNhas given

Merger signed

Oceanic Bank PLC signed a merger agreement with Ecobank Transnational Incorporated (ETI) on August 1 to become the third largest bank in the country
On non-interest banking, Adewale said that banks that were interested were allowed to apply for licence for a window to operate.

Oceanic Bank’s Group Managing Director, Mr John Aboh, in his remarks, said that the bank was working to ensure that it meet with the CBN directives.

He added that the bank currently had liquidity ratio of above 30 per cent requirement stipulated by the CBN.

The Group Managing Director, Union Bank PLC, Mrs Funke Osibodu, said that the bank had engaged in capacity building to enhance infrastructure in the banking sector.

She said that it targeted to train about 250 employees to be specialist on infrastructure, especially in the area of power.

She added that 160 officers had been trained and assured that many more would benefit.

Williams