CBN Would Penalize Banks That House Unauthorized Businesses

Commercial banks in Nigeria have been forewarned against harboring and supporting unauthorized foreign companies.

This instruction was published on Monday by the Central Bank of Nigeria in its "Guidelines for the Regulation of Representative Offices of Foreign Banks in Nigeria" in an effort to strengthen the nation's financial system.

Anyone discovered to be supporting an unregistered financial institution in Nigeria may face fines, including the suspension and revocation of their bank license, according to CBN Director of Financial Policy and Regulation Department Muhammad Musa.

The development occurs as Nigeria's apex banks prepare for foreign direct investment.

According to the CBN's most recent directive, "no foreign bank shall operate in Nigeria without prior approval of the CBN," which is in accordance with its authority under Sections 6(1) and 8(1) of the Banks and Other Financial Institutions Act 2020 (BOFIA).

The CBN reported that in the fourth quarter of 2022, foreign direct investment in Nigeria climbed by 752.71 USD million