The Governor of the Central Bank of Nigeria, Olayemi Cardoso, has said that the exclusion of retained earnings from the recognised capital base of banks in the country would aid transparency in the banking sector.
He said this on Thursday in Lagos at the 15th edition of BusinessDay’s CEO Forum, themed ‘Leadership at Tough Economic Times’.
Cardoso emphasised that the fresh recapitalisation exercise was to strengthen the banking sector.
“With respect to retained earnings, quite frankly, as far as we are concerned, it helps to build comparability with other items. With retained earnings, accounting rules allow you to calculate certain things, take certain things out and put others in, amortisation and such.
“We feel that something that is easily determinable outside of retained earnings does help with comparability. We have absolutely no doubt in our mind that we must move to a more transparent system within the banking system, and this will contribute in no small way to that,” he explained.
