By Dayo Omoogun
The Central Bank of Nigeria (CBN), has reduced interest rates on its facilities through participating Other Financial Institutions (OFIs) from 9% to 5% per annum
for one year effective March 1, 2020 in its continued effort towards lessening the impact of the corona virus (COVID-19) on households, businesses and regulated institutions.
In a circular signed by the Director, Financial Policy and Regulation Department, Kevin Amugo, and issued on Wednesday, May 27, 2020 in Abuja, the apex bank also announced that CBN intervention facilities obtained through participating Other Financial Institutions (OFIs) such as Microfinance Banks (MFBs), Primary Mortgage Banks, and Institutions, among others – will be given a further one-year moratorium on all principal repayments, also effective March 1, 2020.
According to the circular, OFIs have equally been granted leave to consider temporary and time-limited restructuring of the tenor and loan terms for households and businesses affected by COVID-19, subject to the recently issued guidelines for restructuring affected credit facilities in the OFI sub-sector.
Shedding more light on the decision, the Director, Corporate Communications Department, Isaac Okorafor, said that the approval for the restructuring of credit facilities in the Other Financial Institutions (OFIs) sub-sector was in line with the Bank’s desire to alleviate momentary strain on households, businesses and regulated institutions triggered by the lockdown due to COVID-19.
Okorafor added that the CBN would also continue to monitor developments and implement appropriate measures to safeguard financial stability and support stakeholders impacted by the COVID-19 pandemic.