|
Getting your Trinity Audio player ready...
|
The Central Bank of Nigeria (CBN) will conduct supervision of the banking system at least twice every year and take sanctions if non-compliance becomes consistent, Kingsley Moghalu, deputy governor operations, has said.
Moghalu said this is part of the bank’s stance to strengthen the regulatory framework and enhance sustainable banking principles in the country.
Moghalu, who represented Sarah Alade, the bank’s acting governor, made the statement on the sideline of the International Sustainable Banking Forum organised by the CBN, the International Finance Corporation (IFC) and World Bank Group (WBG).
Sustainable banking as defined by UN Brundland Commission in 1993 is meeting the needs of the present, without compromising the ability of future generations to meet their own needs. Sustainability has been conceptualised as environmental, economic and social well-being for today and tomorrow.
“We will assess Nigerian banks and other financial institutions under our supervision and how far they have gone with meeting those nine principles and of course the principles of banking supervisions. If you do not comply we will take sanctions if non-compliance becomes consistent”, he said.
Moghalu observed that the CBN issued a circular which is binding on Nigerian banks and other financial institutions under its regulation, making it mandatory for them to begin to apply those principles in lending practices.
Demonstrating the intersection between sustainability and economic transformation, Moghalu advocated a move away from gas flaring to supporting power sector development, which implies creating economic transformation and at the same time helping the environment.
In his welcome address, Suleiman Barau, deputy director, corporate services, CBN, said although banks play a crucial role in sustainable development, the industry only started playing a major role in sustainable development in the 1990s.
This major shift was as a result of the banks’ realisation that poor environmental and social performance on the part of their clients represented a threat to their business success.
Solomon Adegbie-Quaynor, the IFC country manager for Nigeria and chief investment officer, IFC, said the corporation had supported the power sector with a commitment of one 450 megawatts Industrial Power Plant (IPP).
He said that the corporation had made progress on gas project that could bring about 170 million standard cubic feet per day.
“We are still on the drawing board in terms of potential investors in the distribution sector, but that is because we have the transition arrangement with the Bureau of Public Enterprises (BPE)”, he said.
HOPE MOSES-ASHIKE
