- The apex bank urged the commercial banks on the importance of vetting new investors and significant shareholders through the fit and proper criteria requirements
On Friday, the Central Bank of Nigeria (CBN) disclosed its utilization of security agencies to enforce the new banking sector recapitalization requirement, aiming to curb illicit financing during the process.
Haruna Mustafa, Director of the Financial Policy and Regulation Department at CBN, outlined in a circular that the apex bank’s adoption of stringent anti-money laundering measures is geared towards addressing illegal activities effectively.
Mustafa said, “The CBN has robust anti-money laundering regulations which will be strictly enforced, with the active collaboration of relevant law enforcement agencies.
“In addition, the CBN will require all banks to ensure that appropriate and effective anti-money laundering screening/checks (Know Your Customer, Customer Due Diligence and Suspicious Transactions Monitoring, etc) are conducted.”
The apex bank urged the commercial banks on the importance of vetting new investors and significant shareholders through the fit and proper criteria requirement.
Speaking on the guidelines to be rolled out to the commercial banks, the CBN said, “We will actively monitor and supervise the recapitalization process to ensure compliance with set guidelines.
“This will involve the conduct of on- and off-site reviews, verification of capital, periodic interventions when necessary and broader stakeholder engagements.”
Subsequently, the CBN approved that, “Banks may meet the new requirement through the following options: a. Issuance of new common shares (by way of public offer, rights issues, or private placements); b. Mergers and Acquisitions (M&As); or c. upgrade/downgrade of their respective license category or authorization.
“The CBN will issue guidelines to prescribe the definition, options and approaches to meeting the new minimum capital requirement.”
Earlier, the CBN reviewed the new minimum capital requirements for banks, pegging the minimum capital base for commercial banks with international authorisation at N500bn.
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