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CBN advises investors on long-term funds

15 May 2013, 16:00

Lagos- The Central Bank of Nigeria (CBN) has advised investors to go to the capital market for long-term funds rather than depend on commercial banks.

Mr Ugochukwu Okoroafor, spokesman for the CBN, told News Agency of Nigeria (NAN) on Wednesday that only the capital market had the ability to provide long-term funds to investors.

``The banks’ balance sheets are not structured for long-term loans because they generate their monies from the pool of deposits generated from customers,’’ Okoroafor said.

He said that banks could not take deposits from current account holders and used such funds as long-term loans.

Okoroafor said that every where ``it is not commercial banks that give out long-term loans, it is only from the capital markets that investors can access long-term funds’’.

He said that the CBN was making efforts to see how long-terms funds could be made available to investors.

Okoroafor cited the N3.3 trillion pension funds which government was trying to see how it could be used in the real sector as working capital.

The apex bank’s spokesman said that if the funds were provided, then investors could go to the capital market for long-term loans.

He said that commercial banks could still provide short- term funds, but they must remained liquid.


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