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Although the prevailing conditions that characterised the economic dynamics in 2017 assumed a positive trend on the average on international markets with rising stocks, Nigeria’s economic indices also improved significantly in year, which has necessitated the call for a sustained monetary and fiscal policies by the Chartered Institute of Bankers of Nigeria (CIBN) to sustain the economic growth trajectory in Nigeria as witnessed in 2017.
The economy rebounded after five consecutive quarters of contraction in the second quarter of the year with a marginal growth in Gross Domestic Product (GDP) of 0.6 percent. However, the economy grew at 1.92 percent (year-on-year) in real terms, in the fourth quarter of 2017. The inflation rate which peaked at 18.72 percent in January 2017 consistently dropped reaching 15.37 percent in December 2017, the lowest in 19 months.
While rendering the report of his stewardship at the CIBN 2017 Annual General Meeting (AGM) 2017, the president of the institute Segun Ajibola said the policies put in place by government are proving, as indicated in the World Bank Ease-of-Doing-Business Report 2018, which placed Nigeria in the 145th position among 190 economies, 24 positions better than the 169th position the nation ranked in the 2017 report.
According to Ajibola, the year also saw the launch of numerous government and regulatory agencies’ policies and initiatives intended to boost the Nigerian economy. “The CBN opened a foreign exchange window especially for Small and Medium Enterprises (SMEs) in order to improve activities of the sector. The apex bank also opened a special foreign exchange window for investors and exporters. The ‘Investors and Exporters’ (I&E) FX Window’ was created to boost liquidity in the forex market and ensure timely execution and settlement for eligible transactions,” he stated.
To further facilitate access of SMEs to finance, the then Acting President of Nigeria, Yemi Osinbajo in May 2017 assented to the Security Transactions in Movable Assets Bill, 2017 and the Credit Reporting Bill, 2017 as passed by the National Assembly.
The CBN also sustained its intervention in the country’s foreign exchange market through Dollar injection in the year under review. As at August 2017, it was estimated that a sum of $9.964 billion had been injected by the apex bank since the intervention. This inflow of liquidity translated to significant improvements in domestic production as well as boosted revenue and profits for local manufacturers which aided the country’s recovery from recession in the second quarter of 2017. The global banking industry witnessed fundamental changes in 2017 with Financial Technology (FinTech) redefining activities and operations in the industry. Although cryptocurrency had been around since 2009, the year 2017 marked its emergence into the mainstream.
Ajibola opined that in less than 12 months, the price of a single Bitcoin was in excess of $16, 000 as investors from around the world speculatively pour money into the asset. “In January 2017, Bitcoin was trading at $908 per coin,” said Ajibola.
The global financial services scene in 2017 witness other developments like the marginal, but significant increase in interest rate in ten (10) years by the Bank of England from 0.25 percent to 0.5 percent. Speculations were also rife in 2017 of the looming move of major financial institutions out of London and the wider United Kingdom (UK) once Britain leaves the European Union (EU) in March 2019.
On the financial performance of the institute in the year 2017, Ajibola said it reflected a healthy financial position with the institute posting better results than the preceding year. “This affirms that the policies formulated and implemented to ensure that the institute’s long term financial independence is guaranteed are indeed yielding fruits,” he said.
“In spite of the challenging economic environment encountered in the year under review, the Internally Generated Revenue (IGR) improved to N910.76 million in 2017 from N646.24 million in 2016, representing a growth of 40.93 percent. The year closed with a net operating surplus of N385.12 million in 2017, reflecting a 66.12 percent over N231.83 million in 2016.”
The outgoing CIBN president however noted the in his speech at the 2017 AGM of the institute that their resolve was to continually add value to all stakeholders of the banking sector, build capacity for the industry, uphold ethics and professionalism whilst supporting the economy.
HOPE MOSES-ASHIKE
