CBN, NDIC, CIBN fault Senate’s amendment bill on microfinance banks
•CBN sells $195m ahead of MPC decisions
Major stakeholders in the banking and finance sector have faulted the Senate amendment bill on the licencing, regulation and supervision of microfinance banks (MFBs) in the country.
The stakeholders are the Federal Ministry of Finance, Central Bank of Nigeria (CBN), Nigeria Deposit Insurance Corporation (NDIC), National Association of Microfinance Banks (NAMB) and the Chartered Institute of Bankers of Nigeria (CIBN).
They said they are opposed to the bill, because it would clash with the role of the existing regulators of the banks.
They stated their position at a public hearing organised by the Senate Committee on Banking, Insurance and other Financial Institutions.
The bill is titled, “Act To Make Provision For Licencing, Regulation And Supervision Of Microfinance Business In Nigeria And For Connected Purposes, 2017.”
According to the CBN Governor, Mr. Godwin Emefiele, the bill was unnecessary because “If the licensing, regulatory and supervision roles which have traditionally been the obligation of CBN is now given to the ministry or the NDIC, through the planned amendment, it may cause serious conflict in the nation’s financial system operations.”
Meanwhile, ahead of the decisions of the Monetary Policy Committee (MPC) due today, the CBN auctioned $195 million at the inter-bank foreign exchange (forex) market to boost liquidity in various segments.
At yesterday’s forex trading, the apex bank’s offering was split into three, with $100 million going for wholesale interventions and $50 million allocated to the Small and Medium Enterprises (SMEs) forex window.
The CBN’s Acting Director in charge of Corporate Communications, Isaac Okorafor, who confirmed the deals, said the regulator had continued the intervention to drive down the gaps with adequate liquidity in the market.
Emefiele, who was represented at the senate hearing by the Director of Legal Services, Mr. Johnson Akinkunmi added that the power to licence banks lies with the CBN, adding that no other government agency or ministry was empowered under the law to assume the power to supervise banks, determine their licences and appoint itself as liquidator.
The Permanent Secretary, Ministry of Finance, Mahmud Isa Dutse, who represented the Minister of Finance, Mrs. Kemi Adeosun, explained that the ministry was not asking for powers to supervise banks.
Also, a representative of the chartered institute, Mrs Queensley Seghosime, faulted Section 30 (a), which provides that no one shall be appointed as external auditor of an institution, if he is not qualified under the Companies and Allied Matters Act.
The Managing Director/Chief Executive of NDIC, Umaru Ibrahim, represented by Mr. Atise Erediuawa, said the corporation was ready and would continue to collaborate with the CBN to strengthen the nation’s financial institutions.
The Managing Director of NDIC, Umaru Ibrahim, said the corporation was ready and would continue to collaborate with the CBN to strengthen the nation’s financial institutions.
But, the chairman of the committee, senator Rafiu Ibrahim, who was represented by his deputy, Senator Samuel Anyanwu, explained that bill was to strengthen and reposition the microfinance banks to be effective in service delivery.
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