Governor of the Central Bank of Nigeria (CBN), Mallam Lamido Sanusi, on Monday declared that the apex bank had no intention of deciding for or influencing banks’ credit approval procedures for loan application from customers in various sectors of the economy. Sanusi, who spoke at a public forum in Lagos, explained that although the Central Bank was working to unlock the structural bottlenecks in the way of credit in the economy, explained that CBN was not in a position to dictate to the banks how to allocate credit to customers. He said the decision to grant credit facility to any customer in a free enterprise economy should always be at the discretion of any bank subject to the ability of the customer meeting the conditions stipulated for such facilities by the lending institution.

“I will not force any bank to lend to anybody,” Sanusi said. He added it was a free market where banks were free to lend to sectors they consider profitable in their professional judgment, stressing that if the banks have long term fund, they will lend to their customers.
The apex bank chief assured Nigerian business community that the CBN was working hard to unlock the structural bottlenecks standing in the way of credit administration in the economy, stressing that at the end of the exercise, the citizens would witness significant changes in the economy.

Sanusi said the CBN was, however, working towards achieving an interest rate regime that would hover between 14 and 15 per cent for credit from the banking sector, adding that it was consistent with the current reforms being executed in the industry.

Commenting on the acute credit crunch that has crippled Small and Medium Enterprises in the country, Sanusi attributed the situation to the dearth of funds from the banking sector, assuring that the fortunes of SMEs and Nigerian economy would further improve if the Federal Government fixes agriculture and some of the nation’s infrastructure .

The CBN governor underscored the need for government to be consistent with its policies so as to encourage foreign investors and boost business confidence in the country.
Nigeria’s organized private sector, which has consistently advocated preferential credit allocation to the real sector, believes that its failure to meet set targets was largely due to acute shortage of funds from the banking sector, an argument the CBN helmsman said was inconsistent with the realities of the nation’s environment.

According to him, the problems facing the real sector is rooted in government’s inability to provide or upgrade ailing economic infrastructures that aid production, as funding will be of little consequence if the business environment is right.

Sanusi argued that if Nigeria’s business environment was right and conducive, banks would be willing to finance businesses and organizations operating in the country.