Diversification Only Way Out Of Low Oil Price – Bank CEOs | Independent Newspapers Limited
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Diversification Only Way Out Of Low Oil Price – Bank CEOs

Posted: Jun 26, 2015 at 1:20 am   /   by   /   comments (0)

By Akinwunmi King,   Lagos


For Nigeria to forge ahead despite the low oil price being experienced around the world, Chief Executive Officers (CEOs) of some banks in the country have advised the government to diversify the  nation’s economy to be less dependent on oil as a means of revenue generation.

This advice was given on Thursday at the Nigerian Stock Exchange/Bloomberg CEO Roundtable: Banking and Oil Industries, held the NSE House, Marine, Lagos.

Panelists at the event, who spoke on the topic “The Nigerian Banking Environment in a Low Price World”, noted that the country’s economy got to its present state due to its over dependent on oil.

One of the panelists,  Peter Amangbo, the Group Managing Director/CEO, Zenith Bank Plc, explained that fall in oil price is a major challenge for Nigeria considering the fact that the country depend solely on oil.

Amangbo pointed out that the banking industry is also confronted with its own challenges “but we have been battling seriously with every challenge and we are doing everything to get out of it. If all the banks can come together, it is certain we will get out of it.

“The situation on ground is just a case of panic and I’m always surprised when people say the CBN should devalue. The problem is not for CBN to devalue, the market should be allowed to determine that,” he said.

Also speaking as a panelist, Group Managing Director/CEO, First Bank Plc, Olabisi Onasanya, noted that the country’s over dependent on oil has led to a situation where 18 states in the country can’t afford to pay workers’ salaries.

Onasanya, who expressed confidence that the situation could still be salvaged, advised that “we have an opportunity to rebuild our economy and all we need to do is to diversify and move away from depending on oil.

“Actions need to be taken; people don’t believe us when we say we can defend the naira; there has to be adjustment in the value of naira,” he added.

On his part, an Executive Director at the United Bank for Africa (UBA), Femi Olaloku pointed out that the country has a system that is better than what was obtainable 10 years ago.

While maintaining that there was the need to diversify, Olaloku was of the view that the Central Bank of Nigeria (CBN) must partner with other arms of government for the country to come out of its present predicament. “Let us increase the rate of interest and reduce our dependence on oil,” he added.