Banks, Stakeholders Move To Reduce Non-Performing Loans

Risk managers in the Deposit Money Banks and other key stakeholders have  suggested a move to cut down on the amount of non-performing loans in the banking sector.

The need for the move follows an astronomical rise in the NPLs in the banking sector and the need to establish a private asset management company to manage bad loans in the financial services industry.

The Risk Managers Association of Nigeria, the umbrella body for risk managers in banks and other organisations, met various stakeholders in Lagos on Wednesday to discuss the way forward over the development.

The meeting had in attendance officials of the Central Bank of Nigeria (CBN), the Nigeria Deposit Insurance Corporation, members of RIMAN, legal practitioners and other stakeholders.

They agreed that there was an urgent need to take radical steps to reduce the growth rate of the NPLS in the financial sector in order to protect the financial institutions and the economy.

There was also a consensus to set up a private asset management company to enable the Federal Government to take its hands off the NPLs management in banks.

The Chairman, Board of Trustees, RIMAN, Folakemi Fatogbe, said the association was already putting necessary measures in place to professionalise risk management in the country because of the changing dynamics in global business, particularly Nigeria.

She noted that stakeholders needed to build a working group to arrest the risks posed by non-performing loans to financial institutions and the economy.

Fatogbe said, “We are doing a lot in this management to professionalise risk management, to build capacity in risk management. From the last global financial crisis, it was deemed to also have been caused due to weaknesses in risk management.

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Daniel Enisan is a content writer at edliner.com. With a degree in mass communication, Daniel is a full breed journalist. Daniel is a realist, loves the use of sarcasm, a movie and music junkie. He is also a poet and a good listener.

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