Published On: Tue, Jun 3rd, 2014

EXPECTATIONS HIGH AS NIGERIA’S NEW CENTRAL BANK GOVERNOR RESUMES

Former Zenith Bank CEO, Godwin Emefiele will Tuesday resume work as the 11th Governor of Central Bank of Nigeria (CBN) following the expiration of Mallam Sanusi Lamido Sanusi’s tenure.

Before his assumption, CBN’s Deputy Governor (Economic Policy), Dr. Sarah Alade was acting governor, a position she filled after Sanusi was suspended on February 20, 2014 due to reports of by the Financial Reporting Council of Nigeria and other investigating bodies indicating that his tenure has been characterised by “various acts of financial recklessness and misconduct.

President Goodluck Jonthan had shortly after suspending Sanusi appointed Emefiele as his successor pending a Senate approval which came on March 26.

While Dr Alade has ensured stability in the financial sector, Emefiele still has a lot to do to ensure inflation is kept under control to stabilize price.

The governor had upon his confirmation by Nigeria’s upper house taken a strong stance in favour of the naira, stressing that devaluation would be devastating for a country like Nigeria which is import-dependent.

“I am aware that the core mandate of the Central Bank of Nigeria is to achieve the monetary and price stability. Another core mandate of the CBN is to ensure that we have a strong naira and build strong foreign reserve,” Emefiele told the Senate.

Investment firm, Renaissance Capital (RenCap) had in a February report predicted a devaluation of the naira in 2015, which Sanusi fought throughout his reign and was regarded as one of the reasons for his tight monetary policies.

According to RenCap, a cumulative deterioration in Nigeria’s external position in 2013 and 2014 implies devaluation in 2015.

The country’s foreign exchange reserves declined by 2.62 percent month-on-month from $38.14 billion in April to $37.14 billion by May 27.

Emefiele, whose antecedents speaks volume of his ability to maintain a strong financial system will be expected to ensure decline does not continue. As Zenith Bank MD, the bank had the lowest non-performing loans in Nigeria’s banking industry. A tight monetary policy is therefore expected under the new CBN governor.

The new chief of the apex bank is also known to “ensure the tenets of corporate governance are strictly followed”; he is therefore expected to boost investor confidence and ensure the country’s economic growth continues in Nigeria, already Africa’s largest economy.

source:http://www.ventures-africa.com/2014/06/expectations-high-as-nigerias-new-central-bank-governor-resumes/

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