The Federal Government has urged banks to reduce their reliance on government assets, prioritise affordable loans and increase lending to infrastructure, businesses and other productive sectors.
The government said banking-sector recapitalisation and increased lending to businesses would help convert recent economic stability into stronger private-sector growth.
President Bola Ahmed Tinubu made the call at the 19th Annual Banking and Finance Conference of the Chartered Institute of Bankers of Nigeria (CIBN) in Abuja.
Tinubu noted that banks had avoided business lending for years because government assets offered attractive returns. However, he said improved fiscal conditions should create more room for banks to finance the private sector.
“So, from financing government, we need to move to financing growth,” Tinubu, who was represented by Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said.
In his view, enhanced fiscal discipline would reduce public borrowing requirements, while declining inflation would foster lower interest rates, thereby improving access to capital for businesses and driving investment, output, employment, and income growth.
Emphasizing that the recapitalization must generate broader economic value beyond mere balance sheet strengthening, he noted that the additional capital should translate into expanded financing for Nigerian enterprises and their regional growth across Africa.
He added that the National Credit Guarantee Company serves as the focal point for government-backed guarantees, risk-sharing mechanisms, blended finance initiatives, and credit enhancements aimed at stimulating lending to productive sectors.
Tinubu Pushes Private Capital to Drive Nigeria’s Long-Term Growth
He said the approach would reduce loan risks and attract more private investors to profitable ventures instead of relying mainly on direct government funding.
According to Tinubu, the government should measure its success increasingly by the amount of profitable private capital it attracts, rather than focusing solely on spending.
He also argued that Nigeria could not finance long-term growth mainly with short-term funds. He therefore called for greater mobilisation of long-term capital for infrastructure, industry, housing and energy.
ccording to Tinubu, Nigeria’s capital market has produced over 60% so far this year, and the country is anticipated to shortly rejoin the JPMorgan Bond Index. Travel Guides for Nigeria
He claimed that the changes demonstrated growing investor confidence and gave Nigeria the chance to draw in more money for profitable investments.
Growth facilitation, inclusivity, technology, long-term capital, and trust are Tinubu’s five priorities for a robust financial system.
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