Central Bank of Nigeria (CBN) Governor Yemi Cardoso has revealed that the central bank will soon introduce new foreign exchange laws and guidelines to address the naira depreciation and achieve exchange rate stability.
Cardoso, who delivered the keynote address at the 2023 Annual Bankers’ Dinner of the Chartered Institute of Bankers of Nigeria (CIBN) on Friday, November 24, also said that new recapitalization measures for the banking industry will be implemented by directing banks to raise minimum capital to a level sufficient to support the vision of a trillion dollar economy He stated that he would also implement new recapitalization measures for the banking industry.
He also stated that
Our monetary policy will seek to achieve price stability, promote sustainable economic growth, stabilize the naira’s exchange rate, lower interest rates, and encourage borrowing and real sector investment. Clear, transparent, and harmonized rules governing market operations are essential to ensure the proper functioning of the domestic and foreign currency markets. Before introducing new requirements, new foreign exchange guidelines and laws will be developed and extensive consultations will be held with banks and foreign exchange market operators.
Given the policy imperatives and projected economic growth, it is critical to assess the adequacy of the banking industry to deal with the larger economy envisaged. As we have already established, current assessments indicate stability.
But we need to ask ourselves: will Nigerian banks be adequately capitalized for the financial system needed to handle a trillion dollar economy in the near future? In my opinion, unless we take action, the answer is “No!” unless we take action.
Therefore, we must make difficult decisions regarding capital ratios. As a first step, we will direct banks to increase their capital.”
Regarding the new licensing framework for fintechs, Cardoso said
Technology will continue to play an important role in providing financial services and enhancing financial inclusion.
However, recent developments around payment services have raised concerns about the use of technology and the existing licensing and regulatory framework. We have observed that some licensees are operating outside of their licensed practices and breaching the boundaries set for licensees.
Whether intentional or unintentional, noncompliance will be sanctioned.
At the same time, we will be conducting a comprehensive review of our licensing framework for payment services and will be consulting extensively to develop a new regulatory and compliance framework appropriate for the technology-driven payment services sector.”
