By Uzoma Egwu
The Central Bank of Nigeria (CBN) has been commended  for proposed regulatory requirements of minimum share capital of N 5 billion for primary mortgage institutions (PMIs).

A former president of the Chartered institute of  Bankers of Nigeria (CIBN), Mr Femi Ekundayo, commended the proposal during a farewell dinner for some retiring bank Chief executives, last week, in Lagos.

He commended recent initiatives by the financial sectors regulators including the extension of deposit insurance to primary Mortgage Institutions and Microfinance Banks as well as the setting up of the Asset Management Corporation of Nigeria (Amcon). According to him, the current regulatory requirements of minimum share capital of N5 billion  and N100 million for Primary Mortgage Institutions and Microfinance Banks respectively should be supported for implementation.
“The recent pronouncements of the CBN on new minimum capitalization requirements for Primary Mortgage Institutions and Microfinance Banks were long expected. First, adequate capitalization is a necessity for effective performance of Banking  institutions.

Second, a delay in making a long overdue pronouncement could undermine the regulatory dynamism, seriousness and promptness of the Central Bank. The pronouncements are therefore necessary and apt,” he said.

According to him, mortgage for house ownership is a device acknowledged globally as very effective for economic empowerment. Nigeria should seize and actualize the initiative. The CBN and other banks should also manifest their ability to provide policies, products and services that will stimulate economic growth.

“There should be a roadmap on what banking in Nigeria is expected to achieve as contribution to National Economic Development. The set objectives should include the following: Mortgage for house ownership is a device acknowledged globally as very effective for economic empowerment. Nigeria should seize and actualize the initiative,” he stated.

The former CIBN boss said that a genuinely collective and consensual approach to policy formulation is necessary for the Nigerian financial sector, calling for a collaborative financial regulation  framework that allow effective inputs from all regulatory agencies to stem the tide of inter-sector shocks given that all segments of the financial system are interrelated.

He added that banks should also de-emphasise competition and move onto collaboration in tune with the global trend while consistently improving on their operations to meet the yearnings of the banking public.