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CBN lists criteria for achieving banking system stability

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The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, on Tuesday hinged the achievement of stability in the nation’s banking system on some critical factors, including the adoption of risk-focused and rule-based regulatory framework, zero tolerance in regulatory framework for data/information rendition/reporting and infractions, and strict enforcement of corporate governance principles.

Emefiele was quoted as listing the criteria in a statement on his views at the 2018 Financial Markets Conference with the theme ‘The Nigerian financial market – A catalyst for sustainable economic-growth’, which was organised by the Financial Market Dealers Association of Nigeria in Lagos.

He noted further that timely process for rendition of returns by banks and other financial institutions through e-FASS application software, revision and updating of relevant laws for effective corporate governance and ensuring greater transparency and accountability in the implementation of banking laws and regulation had helped in enhancing bank customers’ confidence in the sector in recent years.

Represented at the forum by the CBN Executive, Mrs Olatoun Akinola, the CBN Governor listed a key initiative that contributed to the strengthening the financial market to moderate illiquidity after the global financial crisis as the establishment of a resolution vehicle (Asset Management Corporation of Nigeria) in 2010.

He said: “Let me mention the ‘Alpha Project Initiative’ which brought about the ‘new banking model’ structure that replaced the hitherto one-size-fits-all model of banking. This new model resulted in the establishment of international banks, national banks, regional banks and specialised banks.”

Emefiele noted further that the regulatory initiatives had impacted positively on the banking sector, leading to many Nigerian banks being ranked among key players in the global financial landscape with some of them featuring among the first 20 banks in Africa and among top 1,000 banks globally.

This is even as he noted that the measures had robbed on positively on the nation’s capital market performance, adding that “take for instance, since the aftermath of the effect of the global financial crisis on the capital market, the apex regulator in the capital market has stepped up its surveillance activities and initiated different programmes.”

The FMDA President, Samuel Ocheho, in his remarks at the event, assured that the group would continue to promote the nation’s economic growth through well-informed advice and contributions to national policy discourse.