CBN wants oil marketers’ debts paid to improve financial system stability

By Moses Obajemu

The Central Bank of Nigeria (CBN) has urged the federal government to settle all outstanding contractor-related debts, especially debt owed oil marketers so as to improve the non performing loan position of banks in the country.

The CBN position is contained in the communiqué issued at the end of the 123^rd meeting of the Monetary Policy Committee held on March 25 and 26, 2019.

 Specifically, the apex bank noted the improvements in key financial soundness indicators and commended the federal government for the settlement of debt owed to oil marketers, which has considerably, helped in reducing the non-performing loans (NPLs) portfolio of the banking industry.

 The communiqué said settling the arrears would not only improve the non performing loan position of the banks but would also stabilise the banking system.

 In addition, the MPC reiterated the Bank’s commitment to improve credit delivery, especially to small and medium scale enterprises, while acknowledging efforts by the Central Bank of Nigeria in coordinating the de-risking of lending to the private sector through the collaboration between the Bankers’ Committee and NIRSAL.

 In its consideration of the best monetary policy option, the Committee noted the need for all agencies of government to work hard, not only in consolidating the growth so far achieved, but also in ensuring that appropriate policies are put in place and implemented to create jobs on a mass scale and diversify the economy in a proper direction.