Tinubu urges banks to lend to businesses, not just government, to boost jobs
President Bola Tinubu challenged Nigerian banks to shift focus from financing government to providing affordable credit to businesses and productive sectors, speaking at the 19th Annual Banking and Finance Conference of the Chartered Institute of Bankers of Nigeria on Tuesday. He said macroeconomic stability has returned, with Q2 2026 GDP growth at 4.43%, headline inflation easing to 15.43%, and external reserves exceeding $54 billion, but stability must translate into investment, production, jobs and improved living standards.
Tinubu urged banks to move from intermediation to transformation, measuring success by how much productive capital policies catalyze rather than government spending. He highlighted government efforts to expand credit guarantees, risk-sharing, blended finance and a National Credit Guarantee Company to crowd in private capital. He also called for broader financial inclusion, urging banks to finance small businesses based on viable cash flows rather than collateral, and to reduce reliance on attractive returns from government securities that discourage lending to the real economy.
The President noted that the recent bank recapitalisation must lead to increased capital formation in the economy, not just larger balance sheets, and stressed the need to deepen capital markets, insurance, pension and asset management industries to mobilise savings for long‑term investment. CIBN President Dele Alabi added that 33 banks met the new minimum capital requirements, raising ₦4.65 trillion, Moody’s changed Nigeria’s outlook from stable to positive while affirming the B3 rating, and FTSE Russell will reclassify Nigeria from Unclassified to Frontier market status effective 21 September 2026.
Will banks heed the call to redirect credit toward manufacturers, MSMEs and other productive ventures, potentially lowering borrowing costs and expanding job opportunities, or will they continue to favor low‑risk government securities despite the reform agenda?