Abuja — The Bankers Committee yesterday revealed that the Central Bank of Nigeria is set to increase money in circulation with the sum of N500 billion so as to stimulate credit facilities by the commercial banks.

The committee further said the proposed Assets Management Company (AMC) will be floated with a capital base of N250 billion, which will be contributed by the CBN and the Federal Ministry of Finance in the ratio of 60 and 40 percent.

The committee, which briefed journalists at the end of its meeting yesterday, was presided over by the CBN's Director of Banking Supervision department, Mr. Samuel Oni, along with other bank chief executives.

Oni explained that the said N500 billion will enable banks grant credits for the execution of viable projects, while the N250 billion will enable the AMC to buy up some of the bad loans from the banks.

He said the committee was satisfied the the current economic growth level achieved without the oil sector revenues, adding that if sustained, the future economic development of the country in the first quarter of 2010 is bright.

According to him, "The committee noted with satisfaction the performance of the economy, which grew by more than 7 percent. And the outlook for the rest of the year taking us up to the first quarter of 2010 seems bright.

"This is based on the fact that the growth we have actually recorded was done without the oil sector. It was actually done by the non-oil sector, particularly the agriculture.

"The rise in oil price, rise in oil production and the relative peace in the Niger Delta is an indication that the economy will continue to grow and the committee noted that the banks will continue to support the Federal Government to grow the economy".

Oni also said the committee was satisfied with the CBN's efforts to see that the AMC was set up, saying that the bill will soon be sent to the President, who will forward it to the National Assembly to pass it into law.

The committee noted that the role of banks in the economic development of the country is very important and assured that given the banks' unique position to push the economic growth, the banks had resolved to contribute in fixing the infrastructure, especially power generation.

In his words, "We have agreed with the CBN governor to have economic session in December deliberate on how to support the government, finance infrastructure and help the economy to grow.

"We are going to bring experts, especially development experts, from all over the world.

"The National Assembly has seen the need for the establishment of the AMC.

"On loans, the fact that we don't want any bank to fail does not mean that they are not carrying some bad loans. So the idea of the AMC is to carry over some of those bad loans.

"On the question of credits not flowing as it is supposed to be, that is why the CBN is increasing money supply with N500 billion, which will enable the banks to give credits.

"On bank lending, the banks are being cautious in that they had to study the projects being financed. These processes are what we have to go through in order to have sound banking system".