{"id":16949,"date":"2019-10-19T15:58:38","date_gmt":"2019-10-19T15:58:38","guid":{"rendered":"https:\/\/www.africa-press.com\/nigeria\/?p=16949"},"modified":"2019-10-19T15:58:38","modified_gmt":"2019-10-19T15:58:38","slug":"cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio","title":{"rendered":"CBN to go tough on banks over loan to deposit ratio"},"content":{"rendered":"

The Central Bank of Nigeria<\/a> said it would sanction banks and their customers over fraudulent deals intended to circumvent the loan to deposit ratio policy.<\/p>\n

The apex bank had initially set the LDR at 60 per cent before raising it to 65 per cent with a December 2019 deadline.<\/p>\n

While this has led to lower lending rates, some banks are now giving loans to customers who go on to buy treasury bills and other securities at CBN\u2019s open market operations.<\/p>\n

But the CBN has instructed banks to reverse the Treasury Bills of customers suspected of arbitraging.<\/p>\n

Speaking on the sidelines of the IMF and World Bank meetings in Washington DC, the CBN spokesman, Isaac Okorafor, said banks and customers will be punished and blacklisted for arbitrage.<\/p>\n

He said, Our policy is meant to spur manufacturing output. We have started to see banks now marketing their customers for loans including consumer credits and mortgages,\u201d he said.<\/p>\n

\u201cNow that these are coming at low rates, manufacturing companies should concentrate on their manufacturing businesses and not on arbitrage. This is how manufacturing output and GDP can be boosted.<\/p>\n

\u201cAny customer found arbitraging will be blacklisted, names will be published in the newspapers and the banks will be penalised.\u201d<\/p>\n

He said Nigerians have been praying for low rates. \u201cSo if borrowing rates from banks are coming down, companies should take the loan to conduct their manufacturing business and not get involved in arbitrage.<\/p>\n

\u201cWe are saying banks must lend. So we prescribed the LDR. Now that they are ready to lend and at reasonably low rates not buying securities, people should not borrow to buy securities thereby arbitraging.<\/p>\n

\u201cThe economy must see growth induced by higher consumer and manufacturing output. We will be tough on banks and companies that would attempt to game our policies through financial markets arbitrage.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

The Central Bank of Nigeria said it would sanction banks and their customers over fraudulent deals intended to circumvent the loan to deposit ratio policy. The apex bank had initially set the LDR at 60 per cent before raising it to 65 per cent with a December 2019 deadline. While this has led to lower […]<\/p>\n","protected":false},"author":62,"featured_media":13827,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[24,15],"tags":[503,653,342],"class_list":["post-16949","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","tag-cbn","tag-emefiele","tag-gdp"],"yoast_head":"\nCBN to go tough on banks over loan to deposit ratio - Nigeria<\/title>\n<meta name=\"description\" content=\"The Central Bank of Nigeria said it would sanction banks and their customers over fraudulent deals intended to circumvent the loan to deposit ratio policy.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"CBN to go tough on banks over loan to deposit ratio\" \/>\n<meta property=\"og:description\" content=\"The Central Bank of Nigeria said it would sanction banks and their customers over fraudulent deals intended to circumvent the loan to deposit ratio policy.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio\" \/>\n<meta property=\"og:site_name\" content=\"Nigeria\" \/>\n<meta property=\"article:published_time\" content=\"2019-10-19T15:58:38+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/nigeria\/2019\/08\/Godwin-Emefiele2-1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"750\" \/>\n\t<meta property=\"og:image:height\" content=\"463\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"alico\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"alico\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio\"},\"author\":{\"name\":\"alico\",\"@id\":\"https:\/\/www.africa-press.net\/nigeria\/#\/schema\/person\/50afd2ef4f0e900bd0a176404a8484a7\"},\"headline\":\"CBN to go tough on banks over loan to deposit ratio\",\"datePublished\":\"2019-10-19T15:58:38+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio\"},\"wordCount\":314,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/nigeria\/2019\/08\/Godwin-Emefiele2-1.jpg\",\"keywords\":[\"CBN\",\"Emefiele\",\"GDP\"],\"articleSection\":[\"all news\",\"Economy\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio\",\"url\":\"https:\/\/www.africa-press.net\/nigeria\/all-news\/cbn-to-go-tough-on-banks-over-loan-to-deposit-ratio\",\"name\":\"CBN to go tough on banks over loan to deposit ratio - 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