TUNDE OYEDOYIN
Tunde Oyedoyin is a London-based personal finance coach and founder of Money Intelligence Coaching Academy, a specialist academy of personal finance. He can be reached as follows: +447846089587 (WhatsApp only); E-mail: tu5oyed@gmail.com
Over a week ago, yours truly sat in the office of a neurologist at the St Mary’s Hospital in Paddington, West London, as he reviewed the case of a patient of his.
As he was thinking aloud on whether to change the patient’s medication, he leaned on the familiar saying that “if it’s not broken, don’t fix it” to support his decision to not change the medication. After all, the patient was there with us and was in very good health and condition. Moreover, there were no concerns about the gentleman’s health.
Central Bank of Nigeria (CBN) governor, Yemi Cardoso, and his crew were thinking beyond the neurologist’s supporting argument when, the day before Good Friday, the much anticipated directive on recapitalisation was dished out to banks. I was on the road late on Thursday night when a member of a group I belong to, first broke the news.
Yours truly didn’t think much about it, especially as I was on a night out. That aside, I do not own a bank nor have a seat on the board of either a regional or second tier one for that matter.
But the morning after, which as already mentioned, was Good Friday, while watching News Day on Arise News, I saw the need for those financially savvy to make the CBN directive to banks personal.
Financial economist, Uche Uwaleke, a professor of finance and capital markets, who was featured during the segment on: “Bank’s recapitalisation: Likely scenarios,” argued in favour of the CBN’s order, noting that the emphasis on bringing in fresh capital made a tonne of sense. According to the university lecturer, while the apex bank has done this primarily for the good of the banks, the multiplier effects will definitely trickle down the economy.
From a personal finance standpoint, the reason we need to take a cue from the directive is to make us more financially stable. Just as Uwaleke argued, with an increased financial muscle, banks will be more than able to withstand stormy weather and their share price may even increase. They’ll be more capable of financing more projects as well. So, CBN has done well for us all by thinking beyond the “if it ain’t broken, don’t fix it” mantra of the neurologist as already mentioned.
Therefore, don’t wait until inflation erodes your savings before starting to think of looking for new money. Tell you what? Your fresh capital might mean looking for work.
The other strand of the CBN directive is the two-year window that the banks have to comply and find the fresh money. For us, it may translate to giving yourself up to a year to acquire some hundreds of new shares. So, take a cue and seek fresh capital . Don’t just rely on your retained earnings or savings.
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