Banks Urged to Adhere to Lending Rules

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Peter Uzoho

Banks and other financial institutions have been advised to return to the fundamentals of lending in order to restore sanity and prevent incidences of bank distress.

The President and Chairman in-Council, Chartered Institute of Bankers of Nigeria, Professor Segun Ajibola, made the appeal in Lagos during the launch of his two books: “Lending and the Nigerian Banks: A Practitioner’s Experience,’ and Structure of Nigerian Economy: 1960-2017,” on Wednesday.

He said the book, ‘Lending and Nigerian Banks’ which reviewed the principles of bank lending in Nigeria, discovered a total disregard of such rules resulting to one form of bank crisis to another.

Ajibola noted that the Nigerian environment was so permissive that lending bankers console themselves with huge interest and figures at the expense of shareholders and depositors’ fund.

“For sanity to return to bank lending in Nigeria, we must return to the basics. The simple rules of credit and canons of lending can only be

ignored at the lender’s failing. So I’ve captured the major deviation between what it is and what it ought to be in this book,” Ajibola said.

He further said: “My findings showed clearly a near total deviation from the basic rules of credit in our clime. I watched helplessly how risk management was relegated to the background. I made enemies out of the

system by canvassing adherence to the rule of the game.

“I listened with pains and anguish how preference for returns at the expense of capital was rationalsed. I listened to friends who have the same woes.

“It is my considered opinion that whenever a bank or lending institution runs into crisis traceable to bank loans, everybody that

played one role or the other in in that regard should be called to question whether or not such person still remains in the system.”

On his part, the Chief Consultant, B. Adedipe Associates, Dr. Biodun

Adedipe, who reviewed one of the books described the 199-page book as an excellent teaching material for lecturers in Banking and Finance, noting that it is also a good

reference material for students and trainers in the banking system.

Earlier, the Chairman of the occasion/Chief Launcher, Otunba Subomi Balogun, who was represented by his son and Group Chief Executive of First City Monument Bank Holdings, Mr. Ladi Balogun, described the book as a handy reading material for anybody in banking and academic environment.