'No Bank has Capital Adequacy Problem'

The CBN Governor, Mr Godwin Emefiele, said that no bank in the country had any problem meeting the required Capital Adequacy Ratio of 10 per cent.

Emefiele said this on Tuesday in Abuja while fielding questions from newsmen after the conclusion of the Monetary Policy Meeting.

The News Agency of Nigeria (NAN) recalls that there were reports that the CBN had given three commercial banks until June 2016 to recapitalise after failing to meet required 10 per cent capital adequacy ratio.

According to the reports, the three unnamed banks stand to lose their licences if they do not meet the apex bank’s deadline.

``This has been a subject of topical discussion of late. Let me confirm that there is no bank in Nigeria that has capital inadequacy today. The news around is all false.

`` The CBN has its own internal mechanism to monitor banks. We conduct monthly stress testing of the operations and activities of commercial banks.

``We stress test their balance sheets on regular basis, using different scenarios to determine the strength and strategic health of a bank.

``So when we carry out our stress test and a bank has, say 10.5 per cent liquidity ratio, we write an informal disclosure to the bank to let them know that they are close to the minimum ratio.

``We advise them on what to do not to fall below the minimum liquidity ratio benchmark of 10 per cent. That is what we do. And so far no bank has reached the minimum benchmark,’’ he said.

Emefiele said the introduction of Bank Verification Number (BVN) had brought sanity to the sale of foreign exchange at the Bureau de Change (BDC) segment.

He said that the CBN directive to BDC operators to take down BVN of all customers interested in purchasing foreign exchange had enabled the apex bank to track illicit financial flow in and out of the country.

He said also that the policy was already bearing fruit as naira continues to appreciate at the BDC segment.