The
Central Bank of
Nigeria (CBN) has said there is no “unsafe”
Bank in
Nigeria . It has also categorised 10
Out of the 25 banks in the country as “sound”, 12 as “satisfactory” and three “marginal”.
The news about the
Health of banks was contained in CBN’s Annual Report and Statement of
Accounts for the year ended December 31, 2006 which was released yesterday in
Abuja .
Banks’ depositors, however, need not fear as the CBN
Governor , Prof.
Chukwuma Soludo, has several
Times assured that
All the 25 banks
Are “big, strong and reliable.”
All the 25 banks, according to the report, were rated using the CBN’s
Capital Adequacy,
Asset Quality,
Management , Earning, Liquidity (CAMEL) parameters.
The report also revealed that the 25 banks were owed N1.553 trillion by 48,494 borrowers as at December 2006.
“This
Development indicated an improvement over the preceding year (2005), reflecting positive results of the
Bank consolidation exercise,” the report said.
The banking watchdog, however, noted that there was no unsafe
Bank in the country, unlike the preceding year which had 18.
The CBN had in 2005 rated five banks as sound, 47 as satisfactory and 16 marginal.
But following the banking
Sector consolidation exercise which required banks to have a minimum
Capital base of N25 billion, the number of banks in the country dropped from 89 to 25 by December 2005.
The existing banks
Are:
Access Bank ,
Afribank ,
Diamond Bank ,
ECOBANK , Equitorial
Trust Bank ,
First City Monument Bank ,
Fidelity Bank ,
First Bank ,
First Inland Bank ,
Guaranty Trust Bank ,
IBTC -Chartered
Bank ,
Intercontinental Bank and
Nigeria International Bank .
Others
Are Oceanic Bank , Platinum
Bank ,
Skye Bank ,
Spring Bank ,
Stanbic Bank ,
Standard Chartered Bank ,
United Bank of
Africa ,
Sterling Bank ,
Union Bank ,
Unity Bank ,
Wema Bank and
Zenith Bank PLC .
On
Prudential examination, the report indicated that only one
Bank failed to meet the CBN’s statutory minimum required
Capital Adequacy Ratio (CAR) of 10 per cent as at end-December 2006, compared with 12 in 2005.
“Four banks could not meet the minimum prescribed liquidity ratio of 40 per cent as at end-December 2006, as against 24 in 2005. The banks that failed to meet the minimum liquidity ratio requirement were penalised accordingly,” it added.
Prudential examination on the other
Financial institutions showed that the number of primary
Mortgage institutions (PMIs) that met the minimum paid-up
Capital requirement of N100 million
Rose to 74, compared with 45 in 2005.
Also, 35 PMIs complied with the prescribed minimum
Mortgage Assets to
Total Assets ratio of 30 per cent, as against 15 in 2005.
In addition, 61 and 73 PMIs satisfied with the prescribed minimum liquidity ratio of 20 per cent and
Capital adequacy ratio of 10 per cent, respectively, as against 55 and 66 PMIs in 2005.
The
Apex Bank noted that the web-enabled
Credit Risk
Management System (CRMS) database had outstanding balance of N1.553 trillion involving 48,494 borrowers, an increase of N165 billion over the N1.388 trillion involving 34,366 borrowers recorded in preceding year.
The CBN attributed the increase in both the
Naira Value and number of borrowers of the banking
System Credit portfolio to the growing
Confidence of the
Public .
“The non-performing
Loans of the banks declined by 40.9 per cent to N220 billion as at end-December 2006, reflecting partly improvements in the quality of
Credit facilities and increased recovery during the period under review.
“The ratio of non-performing
Loans to the
Industry Total Credit fell to 8.7 per cent from 19.3 per cent recorded as at end-December 2005. The ratios were within the acceptable contingency threshold of 25 per cent for the
Industry ,” the CBN report disclosed.
