Similarly, inefficient risk management practices, under-capitalisation, restrictive mandates as well as limited use of information technology, among others have all contributed to the menace.
Although the Federal Government has over the years facilitated the establishment of a few DFIs expected to provide financial interventions for enterprises in key sectors of the economy to complement the efforts of the conventional banks towards the financing of long-term developmental projects, the efforts have, however, failed to meet stakeholders expectations.
The Director, Other Financial Institutions Supervision Department of the Central Bank of Nigeria (CBN), Nkiru Asiegbu, disclosed this yesterday in a goodwill message to the yearly General Assembly/Conference of the Association of Nigerian Development Finance Institutions [ANDFI], held in Abuja.
Represented by Harry Agbo of the OFIS Department of the CBN, Asiegbu however said despite these challenges, the subsector recorded successes in some areas adding, “In terms of impact on the economy, the aggregate net loans and advances grew by 45.06 percent to N1.58 trillion at end December 2021 from N1.092 trillion at end December 2019’’.
According to Asiegbu further stated, ‘’Total assets also rose significantly by 51.12 percent to N3.05 trillion at end of December 2021 compared with N2.02 trillion at end December 2019’.
The director explained that the aggregate shareholders’ funds increased by 67.16 percent to N453.24 billion at end December 2021 from N271.14 billion at end December 2019 respectively..
In his welcome address, the Association of Nigerian Development Finance Institutions (ANDFI) Chairman, Olukayode Pitan said that Nigeria presents a unique context for the developmental mandate of DFIs stressing that country is charged with enabling various sectors and segments of the economy such as agriculture, industry, infrastructure, export and import as well as mortgage.
Pitan, who is also the Managing Director of the Bank of Industry (BOI), explained that key challenges that have impacted the spread of execution include global and local economic headwinds, limitations with accessing funds, unfavourable credit ratings and asset deterioration among others, even as the advent of Covid-19 has equally exacerbated these issues further stressing that the issues have adversely impacted the success and growth of private sector players in the Nigerian economy.
He noted: “At this point, permit me to provide an update on the ANDFI secretariat, a new and furnished workspace has been established at the BOI Abuja Corporate Office and three staff members have been recruited—an Executive Secretary, Administrative Officer and a Research /Training Officer. They have been tasked with executing the vision of the secretariat and provide regular updates as required.”
He charged participants to speak with one voice in a collective effort and desire to influence government policies and matters of common interest while encouraging mutual assistance and investment co-operation among members, investing in training and development of members, and jointly carrying out studies on issues of national economic growth with a view to promoting development in our nation.
Delivering a paper on the Theme, ‘’Innovative Financing for Sustaining Growth and Development’ ’the Managing Director, Uganda Development Bank Ltd, Mrs. Patricia Adongo said that ANDFI has a role to play in economic development in the African continent adding that policy makers in Africa have realized the need to mobilize the needed funding to support and finance national development plans.