The Central Bank of Nigeria (CBN)’s Act of 2007 of the Federal Republic charges the Bank with, among others, the overall control and administration of the monetary and financial sector policies.
Consequently, the bank is to ensure monetary and price stability, maintain external reserves to safeguard the international value of the naira and as well promote a sound financial system in the country.
In addition to its core functions, CBN has over the years performed some major developmental functions, focussed on all the key sectors of the economy.
It is to the credit of the present governor, Godwin Emefiele that he sounded loud and clear from the inception of his administration, his desire to pursue, with vigour, the developmental role and which has resulted in the Bank’s direct involvement in such programmes as the Anchor Borrowers and direct interface with farmers in the distribution of equipment and other farm inputs.
However, in ensuring monetary and price stability, the regulator is expected to also ensure close monitoring and supervision of the banks, without which, the growth of the economy will be jeopardized.
It is on records that the bank carries out periodic examinations on the activities on the banks. This is also complemented by the quarterly, half and yearly reports by the banks which are first vetted by CBN, after serious work must have been done by the external auditors.
But recent revelations of movements of cash in and out of the country have become major concerns to analysts over the efficacy of CBN’s much mouthed cashless policy.
More worrisome, according to the analysts is the fact that the financial institutions may have not only become conduit pipes for siphoning funds out of the country, but also have perfected acts of doctoring annual reports, so much that, some banks produce two different types. One for the regulators and the other for the investing public.
This is why last week’s revelation by the Chairman and Managing Director /Chief Executive Officer of First City Monument Bank (FCMB), Adam Nuru, that N573million was posted into a church account in error since 2016 and was not public knowledge has left many analysts wondering the relevance of the supervisory role of CBN.
Precisely, last Thursday, 6th August Nigerians got the greatest surprise regarding the Probe of the suspended Chairman of the Economic and Financial Crimes Commission (EFCC), Ibrahim Magu by Justice Ayo Salami Probe panel, when on that fateful day Nuru testified that there was actually a bank transfer of #573 million into Pastor Omole’s church account, claiming, it was mistakenly transferred into the account.
Nuru, while giving evidence on the funds traced to the account, narrated that ” On January 16, 2016, we made a return to NFIU which indicated that there was a transaction of an inflow of well over N573million. (N573,228,40).
“This return was said to be in favour of Divine Hand of God Prophetic Ministries Account No 1486743019.
“After that report, we conducted an investigation and discovered that the lodgement which we reported to NFIU was an error.
“The error was as a result of the fact that we were using a bank application called Pinnacle-7. However, we migrated from that application to a newer version called Pinnacle-10.
“Usually, when the bank intends to migrate from one application to another, we utilise weekends to carry out the exercise. The migration involves moving all the balances of customers from the previous application to the new application. The account of the Divine Hand Ministries was moved during that migration.”
He said the group wanted to focus on improving shareholder value with the divestment and boost the capital position of its commercial banking unit, First Bank, to 16.53% as of June, from 15.5% a year ago, close to the regulatory minimum of 15%.
“The outlook continues to remain uncertain. We think that the remaining part of the year will be challenged,” Urum Kalu Eke, CEO, FBN Holdings said on an analyst call.
In 2010, CBN directed lenders to either sell their stakes in subsidiaries involved in activities including insurance, asset management and investment banking – or adopt a holding company structure, where those activities are separate from the holding of retail deposits
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