• Capital base may hit N200m
THE Central Bank of Nigeria (CBN) may conclude the ongoing reforms in the Finance Houses' subsector in October, The Nation has learnt.
Findings showed that the regulator is likely to fix the subsector's minimum capital base at N200 million, from N20 million, about 180 per cent increase.
Executive Secretary, Finance Houses Association of Nigeria (FHAN) Ben Nwokike said operators and investors were awaiting the completion of the reforms which started last year.
He said both local and foreign investors were willing to recapitalise and invest in some of the ailing finance houses but for the CBN guideline.
He explained that unlike banks, finance firms are not allowed to accept deposits. This means they can only source funds from shareholders, private equity companies, development finance institutions and other institutional investors.
Nwokike said the reforms are being hindered by government bureaucracies. He said there are some investors who have carried out due diligence on some of the finance houses but cannot move in funds because the regulation in the sub-sector remains unclear.
He said the new capital base for the subsector remains a critical factor that investors want to be acquainted with before staking their funds, adding that this would ensure that only seriously minded operators were allowed to carry on businesses.
Findings also showed that other policy issues such as the criteria for the appointment of managing directors would form part of the reforms.
