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Recapitalisation: Don’t Repeat The 2005 Mistakes, Economists Warn CBN

The duo of Muda Yusuf and Prof Segun Ajibola have urged the Central Bank of Nigeria to give banks enough time for a systemic migration.

With plans by the Central Bank of Nigeria (CBN) to introduce a new capital base for deposit money banks in Nigeria, economists have cautioned the apex bank from making some mistakes made during the last recapitalisation of commercial banks in the country.

The Founder of Centre for Promotion of Private Enterprise, Muda Yusuf; and Prof Segun Ajibola of Babcock University, Ogun State,

both spoke on Channels Television’s Sunrise Daily programme on Monday.

The economists agreed that recapitalisation of banks has become inevitable but it must be done in such a way that the mergers and acquisitions that would hit banks won’t lead to massive job cuts.

“What we had in 2005 was very unfortunate. Banks should not be stampeded,” Yusuf said, urging the CBN to give banks enough time for systemic migration.

He suggested a year or two for the process and not for the apex bank to insist on a short deadline like what was done during the era of ex-President Olusegun Obasanjo.

On his part, Ajibola called for strategic consultations between stakeholders for the process to be fluid and successful, saying that the CBN should not force banks into unholy alliances.

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