Adedapo Adesanya
By Adedapo Adesanya
The Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, has assured that Nigerian banks are not directly exposed to the Silicon Valley Bank crisis and, by implication, the wider global banking jitters.
The CBN Governor made this statement when responding to questions after the Monetary Policy Committee (MPC) meeting held in Abuja on Tuesday.
Mr Emefiele stated that Nigerian banks are healthy, having met all the prudential guidelines it set for the financial system.
According to the CBN chief, Nigerian banks have already implemented the CBN prudential guidelines, such as its cash reserve ratios, capital adequacy ratios, non-performing loans (NPL), and liquidity ratios.
There have been concerns about the health of the global financial system in the aftermath of the March 10 collapse of Silicon Valley Bank.
According to the CBN Governor, the apex bank conducted a review of all the bond portfolios of Nigerian banks and determined that none of them was exposed to the failed bank.
He suggested that Nigerian banks are ultimately owned by bank depositors and not shareholders.
“We will rather dispose of shareholders than make depositors lose money,” suggesting that bank customers had more no loss in banks than their shareholders.
He, however, did not speak to exposure to other banks currently caught in the line of fire, such as Credit Suisse.
US regulators had stepped into the trouble following the troubles in SVB and Signature Bank by guaranteeing deposits earlier this month.
However, the collapse of Credit Suisse over the weekend reignited fears of contagion across the financial sector.
Unlike SVB, a mid-tier bank, Credit Suisse is a top financial organisation – big enough that it is among 30 banks considered to be of systemic importance to the global economy.
UBS agreed to buy its embattled rival Credit Suisse for $3.2 billion on Sunday, with Swiss regulators playing a key part in the deal as governments looked to stem a contagion threatening the global banking system.
The terms of the deal will see Credit Suisse shareholders receive 1 UBS share for every 22.48 Credit Suisse shares they hold.
