The President and Chairman of Council of the Chartered Institute of Bankers of Nigeria (CIBN), Dr Dele Alabi, has said Nigeria’s improving macroeconomic indicators will mean little unless they translate into lower living costs, more jobs, higher incomes and improved living standards for citizens.
Alabi spoke on Tuesday at the opening of the 19th Annual Banking and Finance Conference of the CIBN in Abuja, where he stressed that the ultimate measure of Nigeria’s economic reforms should be their impact on households, businesses and the daily lives of ordinary Nigerians.
He noted that although the economy was showing signs of stabilisation and growth, many Nigerians continued to face difficult economic conditions.
According to him, improved economic fundamentals should be viewed as milestones rather than the final destination.
“They are milestones, not the destination. The true test is whether stronger fundamentals translate into lower living costs, more jobs, higher real incomes, affordable credit, reliable public services and reduced poverty.
“Macroeconomic progress must, therefore, be felt at the micro level in households, small businesses and the daily lives of ordinary Nigerians. Our task is to build systems that learn, adapt and emerge stronger,” he said.
Alabi said the next phase of Nigeria’s economic reforms should focus on ensuring that the gains from macroeconomic stability reach businesses and households.
He added that the CIBN conference was designed to give practical expression to the institute’s IMPACT Vision, which he unveiled after assuming office in May.
The CIBN president also highlighted the institute’s advocacy for scalable small and medium enterprise hubs across the country as part of efforts to address challenges facing micro, small and medium enterprises.
He said MSMEs continued to contend with high operating costs, inadequate infrastructure, limited market access, low productivity, skills gaps and slow digital adoption.
Speaking at the conference, the Lead Private Sector Development Specialist at the World Bank’s Nigeria Office, Ms Bertine Kamphuis, represented by the bank’s Division Director for Nigeria, Dr Mathew Verghis, said credit to the private sector remained inadequate.
She urged banks to increase financing to sectors with significant job-creation potential, particularly agriculture, manufacturing and MSMEs.
Kamphuis noted that with between three and four million young Nigerians entering the labour market annually, expanding access to productive credit had become increasingly important.
Tinubu Urges Banks to Rethink Risk
President Bola Tinubu also challenged Nigerian banks to rethink their approach to risk and play a greater role in financing productive sectors of the economy rather than focusing predominantly on profits and shareholder returns.
The President, represented by the Minister of Finance and Coordinating Minister of the Economy, Mr Taiwo Oyedele, said strong bank profits alone should no longer be regarded as sufficient.
He urged financial institutions to contribute more directly to economic growth and improved welfare for Nigerians.
“For years, we have measured financial institutions by balance-sheet growth, profitability and shareholder returns. These remain important. But we must increasingly ask: what is the financial system doing for the real economy?” Tinubu said.
He noted that a resilient banking system could not be sustained indefinitely while businesses struggled to obtain affordable credit, manufacturers faced difficulties financing expansion and millions of productive MSMEs remained outside the formal financial system.
“This requires us to rethink risk. The safest loan on an individual bank’s balance sheet is not necessarily the best allocation of capital for the economy,” he said.
Tinubu said Nigeria’s economy had returned to a path of stability, with investor confidence improving, but cautioned that macroeconomic stability should not be confused with prosperity.
“Economic stability has returned. Credibility is rising. And prosperity is coming. These improvements matter. But we must not mistake macroeconomic stability for economic prosperity. Stability is the foundation; prosperity is the destination,” he said.
According to the President, the next phase of the reform programme should focus on converting stability into investment, investment into production, production into jobs and economic growth into improved living standards.
He said the objective should not simply be to build larger banks with stronger balance sheets, but to create a bigger and more productive economy.
“Capital must reach ideas, finance must enable enterprise, technology must expand opportunity, risks must be intelligently shared, and growth must translate into better lives for our people,” he added.
Tinubu said the banking and financial services industry would remain central to achieving the country’s economic objectives, urging banks to fully embrace their role as financial intermediaries.
On the ongoing bank recapitalisation exercise, the President said the initiative must produce benefits beyond stronger balance sheets.
He said the exercise should support capital formation in the real economy, enable Nigerian businesses to expand across Africa and contribute to the country’s ambition of building a $1 trillion economy.
“A bigger bank that does not finance a more productive economy is a suboptimal outcome. We must build a system that finances potential and opportunity rather than quick gains for the privileged,” Tinubu said.
CBN: Bank Recapitalisation Shows Local Capital Depth
In his goodwill message, the Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, said the significant capital raised by banks through the recapitalisation exercise demonstrated the depth of capital available within the domestic market.
Cardoso, represented by the Deputy Governor in charge of Policy, Philip Ikeazor, urged banks to deploy the additional capital towards financing the real sectors of the economy.
He said greater funding for productive activities was necessary to accelerate economic growth and improve living standards across the country.
The CBN governor also called on state governments to collaborate with the apex bank and federal fiscal authorities in efforts to contain inflation.
He expressed optimism that single-digit inflation could be achieved through stronger cooperation among relevant stakeholders.
