The Central Bank of Nigeria (CBN) has agreed to extend the deadline by one year for microfinance banks (MFBs) to recapitalize as needed to avoid closing branches to comply with CBN’s regulatory framework that was revised in 2011 to limit the number and locations of branches MFBs can operate based on their level of capital. Initially, CBN had set a compliance deadline of December 31, 2012, however, it was reported that many MFBs failed to meet that deadline. The new deadline for compliance is December 31, 2013.
As of November 2012, CBN reports total assets of NGN 13.3 trillion (USD 82.4 billion).
By Lena Phillips, Research Associate
About The Central Bank of Nigeria (CBN)
The Central Bank of Nigeria (CBN) was established in 1958 as Nigeria’s central banking authority. As defined by the act of parliament that created CBN, its statutory mandates are as follows: “to issue legal tender currency; to maintain external reserves; to safeguard the international value of the legal tender currency; to promote monetary stability and a sound financial system in Nigeria; and to act as banker and financial adviser to the Federal Government.” As of November 2012, CBN reports total assets of NGN 13.3 trillion (USD 82.4 billion).
Sources and Additional Resources:
ChannelsTV.com Article, “CBN Expands Deadline For Recapitalisation of Micro-Finance Banks,” http://www.asiainsurancereview.com/News/View-NewsLetter-Article/id/27067/Type/eDaily
CBN Circular: “Circular on the revised microfinance policy regulatory and supervisory framework for Nigeria,” http://www.cenbank.org/out/2012/ccd/circular%20on%20compliance%20with%20the%20revised%20microfinance%20policy%20framework%20reminder.pdf
MicroCapital.org Article, 19 February 2013: “MICROCAPITAL BRIEF: Central Bank of Nigeria (CBN), National Association of Microfinance Banks to Establish Technical Committee to Address Implication of Microfinance Policy, Including recapitalization of MFBs,” https://www.microcapital.org/microcapital-brief-central-bank-of-nigeria-cbn-national-association-of-microfinance-banks-to-establish-technical-committee-to-address-implication-of-microfinance-policy-including-recapitalization/
MicroCapital.org Article, 5 February 2013: “MICROCAPITAL BRIEF: Smaller Microfinance Banks in Nigeria Want 2 More Years to Raise Capital or Close Branches,” https://www.microcapital.org/microcapital-brief-smaller-microfinance-banks-in-nigeria-want-2-more-years-to-raise-capital-or-close-branches/
MicroCapital.org Article, 4 October 2011: “MICROCAPITAL BRIEF: Central Bank of Nigeria Approves New Capital Base Requirements for Microfinance Banks (MFBs), MFBs Await Capital Verification Results,” https://www.microcapital.org/microcapital-brief-central-bank-of-nigeria-approves-new-capital-base-requirements-for-microfinance-banks-mfbs-mfbs-await-capital-verification-results/
MicroCapital Universe Profile: Central Bank of Nigeria (CBN), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Central+Bank+of+Nigeria+%28CBN%29
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