By Emma Ujah
ABUJA â€”THE European Investment Bank, EIB, is to buy into some of the nationâ€™s troubled banks, Vice President of the Bank, Mr. Plutarchos Sakellaris has said.
Mr. Sakellaris who spoke after a meeting with the Governor of Central Bank of Nigeria, CBN, Mr. Sanusi Lamido Sanusi, in Abuja, Monday, said the specific commitments which would be announced in two days were expected to strengthen the banksâ€™ liquidity through investments that could significantly increase their capital base and enable them play more supportive roles in the real sectors of the economy.
He said: â€œOn Thursday we will unveil our package for three banks, it will be the type of package that you can imagine and this will be very supportive of their liquidity and enhance their real contribution to the economy. It will also enhance the strength of their capital base.
â€œI will not go further into any of the details but you will see on that occasion that this would be a concrete package of the EIBâ€™s willingness to reinforce our involvement in the Nigerian financial system and this would be a support of confidence of the good work that the governor has begun in ensuring a strong financial sector.â€
The EIB vice president who described Nigeriaâ€™s financial sector as â€œone of the best in Africa and the worldâ€, especially following the banking reforms,â€ noted that the bankâ€™s involvement â€œwill be a concrete proof of EIBâ€™s venture into the Nigerian financial sector and proof of our confidence.â€
He said the reforms were â€œworking to alleviate investorsâ€™ concerns over bad debt in banksâ€, adding that â€œit has also been crucial in helping restore confidence of both Nigerian and international investors.â€
Mr. Sakellaris revealed that EIB provided about $1.5 billion of funding for 29 projects in Sub-Sahara Africa last year, with Nigeria receiving over $600 million which was invested in various sectors of the economy.
In his remarks, the CBN governor said the US EXIMBank has also restored the $1 billion credit line to Nigerian banks, which he said was a further demonstration of the confidence in the nationâ€™s banking industry.
Sanusi restated his determination to make Nigerian banks play the roles of transmission channels to finance electricity, agriculture and infrastructure sectors, among others.
The CBN has been holding dialogues with boards and managements of the affected banks lately with a view to getting them to agree with its plans to allow other investors, from within and outside the country take up equities in the banks.