The Central Bank of Nigeria (CBN), which recently announced that it would be revitalizing the National Arts Theatre by March of next year, has urged for a focus on ratings on infrastructure loan instruments to ease additional financing towards the industry.
This was said by Aisha Ahmad, the CBN’s deputy governor for financial system stability, yesterday in Lagos at both a Fitch In Nigeria event and during an inspection trip of the National Arts Theatre facility.
According to Ahmad, who discussed the function of rating agencies at the Fitch Ratings event, more credit will be directed toward the infrastructure sector, where the nation currently has a sizable deficit.
She said, “on the infrastructure side, I think, there should be more focus on infrastructure project finance as the significant infrastructure deficit in Nigeria is being discussed. Focusing ratings in this area will provide price discovery on those instruments, which should help investors look in that direction.”
The CBN deputy governor added that ratings much like regulation and supervision try to do from a risk perspective, help maintain market discipline and make operators honest. She believes it is safe to say that our proactive, vigilant oversight of the industry, as you are aware, has helped to moderate and mitigate these risks, allowing the Nigerian banking industry to continue to play its part in fostering the real economy and economic growth. In particular, our policies to manage effects risk include more than just monitoring of foreign currency borrowing and net open position limits.