The Central Bank of Nigeria (CBN) has reduced interest rates on its facilities in other financial institutions (OFIs) from nine to five percent per annum for one year, effective from March 1, 2020.
The CBN announced the reduction in a circular signed by Kevin Amugo, director of the financial policy and regulation department.
The apex bank said the move is part of its continued effort to mitigate the impact of the COVID-19 pandemic on households, businesses and regulated institutions.
It announced that CBN intervention facilities obtained through participating microfinance banks, primary mortgage banks, and other financial institutions would also be given a 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.
The CBN had earlier issued similar directives to deposit money banks.
Isaac Okorafor, CBN director of corporate communications, said the restructuring of credit facilities in the OFI sub-sector is 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 explained 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. (The Cable)