Nigerian banks 'cautious' over loans

Feb 14, 2011

Nigerian banks are still reluctant to loan money to consumers, despite the fact they were bailed out by the country's Central Bank (CBN) in 2009.

This is according to Rotimi Durojaiye, writing for the Daily Independent, who noted a recent newspaper reported that the new chief executives of eight financial institutions are concerned about running up bad loans.

Managing Director and Chief Executive Officer of Union Bank Olufunke Osibodu was quoted by the Daily Independent as saying banks are being cautious with loans because they "need to be sure of the kind of risk they are taking".

She also noted that loans have not dried up completely, adding: "Banks are still lending money, but maybe they are [being] careful or prudent in this manner."

Earlier this month, the CBN revealed four of the eight banks it bailed out are being recapitalised, but declined to name the companies involved.

It said new agreements should be signed in the coming weeks.