Lack of commitment may frustrate take-off of construction bank

MR. Charles Adebiyi, a real estate consultant, says lack of commitment by professionals in the construction sector may frustrate the take-off of Construction Development Bank (CDB).Adebiyi told the News Agency of Nigeria (NAN) in Lagos on Friday that although professionals in the sector were desirous of establishing a bank, they were not willing to commit their funds to it.He said that it had become a problem to raise the required money to licence the bank because many of them were not ready to surrender part of the capital.This is why the idea, mooted five years ago is still in the pipeline. With the reforms in the banking sector it is not a big issue to set up banks, but to get the kind of money required is a big job.The major issue is how to muster the required capital to float it, unless outside agencies or local investors have sufficient confidence in the professionals to provide the capital, he said.Adebiyi, who is a former president of the Nigerian Institution of Estate Surveyors and Valuers (NIESV), said that without the intervention of foreign agencies, the Construction Development Bank would remain a dream.He said that Nigerians investors would rather prefer to speculate in the foreign exchange market and make quick gains than invest in the CDB.The fact is that the Construction Bank, as a specialised bank, will not be making profit at the initial stage, unless the CBN allows it to do businesses that can generate revenues quickly, he said.Adebiyi said that the Construction Bank would provide loans for real estate and infrastructure development and the loans would be given strictly to professionals.He said that profits from such long-term investments would take a while and local investors would prefer buying and selling that would yield immediate profits.
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