With reference to the economic struggle faced by many Nigerians as a result of the Covid-19 pandemic which has affected businesses widely, the Central Bank of Nigeria (CBN) has asked banks to restructure 65% of their loan portfolio in order to help borrowers cope with the failing economy.
CBN recognized that due to the effects of the Coronavirus pandemic and the failing oil prices, many borrowers would be stuck without options.
Especially as factors such as the lockdown due to the pandemic, drop in oil prices and dollar shortages have made repayment of these loans difficult for the borrowers.
Therefore, CBN Governor Godwin Emefiele has said that out of a total of N18.9 trillion in credit, loans worth N7.8 trillion across 35,640 customers are already being reorganised.
This restructuring allows lenders to alter the terms of the loans without classifying them as non-performing loans by imposing a moratorium on interest charges and principal debt repayments.
Emefiele opined that banks are key to reviving the economy through loans and credit to farmers in order to catalyse local production.
Adesoji Solanke, director for frontier and sub-Saharan African banks equity research at Renaissance Capital told Bloomberg: “We believe some companies will not survive the crisis so restructuring for those will simply be an exercise in hope”.
“A prudent bank will want to be on top of monitoring cash flows and how its customers’ businesses are doing”, he added.
You may be interested
Senate Confirms Bawa As EFCC Chair, Overlooking Records Of Theft, ArrestWebby - February 24, 2021
The Nigerian Senate on Wednesday confirmed Abdulrasheed Bawa as the new head of the Economic and Financial Crimes Commission (EFCC),…
2nd Term Inauguration: Akeredolu appreciates Oyetola for his supportWebby - February 24, 2021
..describes him as ‘silent operator’ The Ondo State Governor, Oluwarotimi Akeredolu, SAN, on Wednesday expressed gratitude to his Osun counterpart,…
EXCLUSIVE: Bank Documents Expose How Tukur Buratai Cornered NDDC Contracts As Nigerian Army GeneralWebby - February 24, 2021
Tukur Yusuf Buratai admixed his duty to protect Nigeria’s territorial integrity with an appetite for questionable fortune, Peoples Gazette can…