The Centre for the Promotion of Private Enterprise (CPPE) has commended the Central Bank of Nigeria (CBN) for the successful implementation of its bank recapitalisation programme.
In a policy brief released on Sunday in Lagos, the CPPE noted that 32 banks met the new capital requirements without disruptions or losses, describing the process as smooth and effective.
However, CPPE Chief Executive Officer, Muda Yusuf, said the stronger capital base has yet to translate into meaningful support for the real economy.
According to him, private sector credit remains at about 17 per cent of Gross Domestic Product (GDP), below regional and peer benchmarks, while lending to consumers and Small and Medium-scale Enterprises (SMEs) is still weak.
He added that SMEs account for only about one per cent of total credit, despite their critical role in economic growth. Yusuf also raised concerns over the dominance of short-term lending and the skewed allocation of credit across sectors.
He further noted that high interest rates and increased government borrowing continue to constrain credit expansion.
Yusuf called for targeted policy measures to improve access to credit and channel funding to productive sectors of the economy.
“The recapitalisation programme has strengthened the resilience and stability of the banking system, and the Central Bank of Nigeria deserves credit for a smooth and effective process.
“However, the real test lies in how well the banking system supports investment, enterprise, job creation and economic transformation.
“At this stage, the focus should shift from capital strength to economic impact. Nigeria needs not just stronger banks, but banks that deliver for the economy,” he said.
