by SOLOMON AYADO, And AHURAKA ISAH
The Senate yesterday urged the Central Bank of Nigeria (CBN) and Deposit Money Banks to urgently adopt workable strategies that will lead to reduction on lending interest rates to enhance survival of businesses.
The lending rates to the private sector have hovered between 28% to 30% across board in 2017. This, the senate noted has seriously placed a major burden on business investments and household consumption spending in the country thereby negatively impacting on the survival of Nigerian businesses.
Consequently, a motion sponsored by Senator Rafiu Adebayo Ibrahim (Kwara South) has advocated the dire need for a Stakeholders Round Table to address increasing interest rates in Nigeria.
The Central Bank of Nigeria Act, 2007 has given the CBN among other things the responsibility to ensure monetary and price stability and formulating monetary and credit policies and guidelines.
The lawmaker, Ibrahim insisted that the Senate is aware that current MPR of 14% has remain very high compared to other nations such as Brazil-10.25%, Kenya-10%, South Africa-7%, Rwanda-6.25%, Bangladesh-6.75%, Cameroon-2.95 among others.
He stated that despite all the negative indices, banks continue to declare huge earnings and profitability which as at March 2017 increased significantly by 151.02% as PBT stood at N186.155 trillion as against N74.160 trillion in December 2016.
According to him, the CBN is now faced with difficulties in decision making on some of its core mandates of controlling the inflation rate, exchange and interest rates.