The Central Bank of Nigeria (CBN) has withdrawn the operating licences of 46 microfinance banks across the country after determining that the institutions no longer met the regulatory conditions required to continue operations.
The revocation, which took effect on July 1, was announced in a statement issued by the apex bank on Wednesday.
According to the CBN, the decision was approved by its Governor, Olayemi Cardoso, in line with the powers conferred on the bank under Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.
The apex bank said the affected microfinance banks breached one or more regulatory requirements essential for maintaining their operating licences.
Among the reasons cited for the action were inadequate assets to cover liabilities, failure to maintain the required minimum capital, cessation of financial intermediation activities, and shutting down operations without obtaining prior approval from the CBN.
The regulator also disclosed that some of the affected institutions failed to commence operations within 12 months after receiving their licences, contrary to regulatory provisions.
According to the CBN, the move forms part of its broader efforts to reinforce the integrity and stability of Nigeria’s financial system by ensuring that all licensed financial institutions comply with existing laws and prudential guidelines.
“The revocation of the licences is part of the Bank’s ongoing efforts to safeguard the stability of the financial sector, protect depositors, and ensure that licensed institutions comply with current laws and regulatory requirements,” the statement said.
The apex bank reaffirmed its commitment to maintaining a safe, sound and resilient financial system through effective supervision and decisive regulatory enforcement where necessary.
It stated that it would continue to take appropriate supervisory actions to strengthen public confidence in Nigeria’s banking sector and uphold the standards expected of licensed financial institutions.
The latest action underscores the CBN’s intensified regulatory oversight of banks and other financial institutions, with renewed emphasis on corporate governance, risk management, compliance with prudential standards and the overall stability of the financial system.
