The Central Bank of Nigeria has granted an extension for Deposit Money Banks to submit the licences granted to them under the universal banking model.

It, however, failed to give the date for the new deadline.

The move was announced on Tuesday shortly after the 308th bankers’ committee meeting at the apex bank headquarters in Abuja.

The apex bank had in September 2010 as part of measures aimed at repositioning the banking sector fixed an 18- month period for the repeal of the universal banking model.

The deadline, which expired on May 14, had allowed banks to undertake all types of financial transactions thus making them focus less on their core mandate.

The apex bank’s Deputy Director, Banking Supervision Department, Mr. Markus Zacharia, briefed journalists in company with the Managing Director of Skye Bank Plc, Mr. Durosinmi Etti; MD Keystone Bank Plc, Mr. Oti Ikomi; and  MD Sterling Bank Plc, Mr. Yemi Adeola.

Speaking at the event, Adeola said, “The deadline (May 14) was for the submission of the old licences so that the new one could be issued. So this is an essential formality of the process and the CBN has granted an extension for those who have not submitted the old license to do so for new ones to be issued. It is not that there is any issue with universal banking.”

But shedding more light on the issue, Etti said, “The CBN had given a deadline of May 14 for the withdrawal of universal banking license.

“Most banks have submitted their own universal banking licences and been issued with new licences. A few banks have asked for an extension and these are under review and they shouldn’t be any problem in converting their licences they have right now to new ones.

“So everything is going on well and there shouldn’t be problems or issues with any of the banks.”

Ikomi also revealed that the disbursement of the Micro, Small and Medium enterprises development fund would help to unlock the potential of the sector.

On high interest rate, Adeola noted that the risk determines the rates on loans.

He said, “It will not be correct to say that interest rates are very high, because one cannot adopt a uniform standard. There is always a function of the nature of risk that you are taking if the risk is high perhaps the rate will be high.”

Source: Punch/Ifeanyi Onuba