CBN directs banks to cut interest rate, restructure loan terms

March 16, 2020
174 Views

The Central Bank of Nigeria (CBN) has directed all deposit money banks in the country to restructure loan terms and tenors to households and businesses affected by the coronavirus outbreak.

Addressing journalists in Abuja on Monday, Godwin Emefiele, the CBN governor, said the interest rate of its intervention programmes has been cut to 5% from 9%.

“The CBN hereby grants all deposit money banks leave to consider temporary and time-limited restructuring of the tenor and loan terms for businesses and households most affected by the outbreak of Covid-19 particularly oil & gas, agriculture, and manufacturing,” he said.

“The CBN would work closely with DMBs to ensure that the use of this forbearance is targeted, transparent and temporary, whilst maintaining individual DMB’s financial strength and overall financial stability of the system.”

The CBN said beneficiaries of its intervention facilities have been granted an additional one-year moratorium on principal repayments effective March 1, 2020.

“This means that any intervention loan currently under moratorium is hereby granted an additional period of one year.”

“Interest rates on all applicable CBN intervention facilities are hereby reduced from 9 to 5% per annum for 1 year effective March 1, 2020.”

The apex bank said it has created a N50 billion credit facility for small and medium-sized businesses that have been affected by the coronavirus outbreak.

“The CBN hereby establishes a facility through the NIRSAL Microfinance Bank for households and small- and medium-sized enterprises (SMEs) that have been particularly hard hit by Covid-19, including but not limited to hoteliers, airline service providers, health care merchants, etc.”

It has also extended intervention facilities and loans to pharmaceutical companies ” intending to expand/open their drug manufacturing plants in Nigeria, as well as to hospital and healthcare practitioners who intend to expand/build the health facilities to first-class centres”.

This is the first action the central bank is taking in response to the coronavirus outbreak that began in China in December.

You may be interested

AFCON 2025Q: New Boy Osho, Iheanacho, Start For Super Eagles Vs Benin Republic
Sports
Sports

AFCON 2025Q: New Boy Osho, Iheanacho, Start For Super Eagles Vs Benin Republic

Webby - November 14, 2024

The Super Eagles will line-up in a 3-4-3 formation in tonight’s 2025 Africa Cup of Nations qualifying tie against Benin…

My Goal Was To Achieve Success With Ten Hag At Man United –De Ligt
Sports
Sports

My Goal Was To Achieve Success With Ten Hag At Man United –De Ligt

Webby - November 14, 2024

Netherlands international Matthijs de Ligt has suggested Erik ten Hag didn’t get the breaks he needed to keep his job…

I Want To Take My Game To New Level –Lookman
Sports
Sports

I Want To Take My Game To New Level –Lookman

Webby - November 13, 2024

Super Eagles winger Ademola Lookman has reiterated his commitment to take his game to the next level.The Nigerian international, who…

Leave a Comment

Your email address will not be published.