CBN bemoans banks excessive investment in government securities

Central Bank of Nigeria (CBN) has accused commercial banks of excessive investment in government securities rather instead of extending credit facilities to the real sector of the economy.

In a document obtained from the CBN website, the Monetary Policy Committee (MPC) of the apex bank, chaired by its Governor, Mr. Godwin Emefiele, recently discouraged commercial banks operating in the country over there persistent investments in Federal Government Bonds and Treasury Bills on the heels risk-free investment and high returns.

The CBN governor urged DMBs to improve lending to the real sector and explore ways of incentivizing lending to employment- and growth-generating sectors, particularly Small and Medium Enterprises (SMEs).

He noted that harmonization of monetary with fiscal policies is prerequisite for resolving the nation’s economic problems, as regards steering the economy away from oil dependency.