The Central Bank of Nigeria (CBN) has urged the Senate Committee on Banking, Insurance and other Financial Institutions to grant it exclusive rights to issue licenses to banks and revoke them.

The central bank’s governor Godwin Emefielesaid that licensing of banks and revocation of the same when a bank goes distressed will bring the country on par with the international practices and minimise duplication of functions.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

The governor added that the proposed act will help the central bank serve its purpose better by being able to identify the critical roles it plays in regulating the banks.

He proposed that the banking legislation should empower CBN to issue and revoke operating licences to banks while regulating them.

The Nigeria Deposit Insurance Corporation (NDIC) should be in charge of bank resolution activities after a licence is revoked, he added.

Emefiele said that the new amendments should consider “the Enhancement of failing bank recovery and resolution tool kit to give more options for managing failing institutions and systemic crisis without recourse to the public treasury; the creation of a credit tribunal to strengthen credit recovery processes and enforcement of collateral rights; strengthening the framework for reporting for insider transactions as part of measures to boost credit administration processes in banks; enhancements to regulatory measures for single obligor limits, transfer of significant holdings, etc. and strengthening of the sanctions regime to make it more deterrent.”

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

The governor also proposed to review and recognise the unique business models of new entrants, including non-banks into the financial services industry and a pool of several other amendments.

In his own presentation, NDIC managing director Alhaji Ibrahim said: “it was important that the CBN is involved in the process of licensing new banks.”