Appraisal of The Regulatory and Supervisory Role of Central Bank of Nigeria

Reference code P004

ABSTRACT

This seminar paper is a descriptive appraisal of the regulatory and supervisory role of CBN for the period covering 2010 to 2015. For the purpose of the paper, we explored the nature, meaning and classification of bank regulation and supervision. The paper showed that in addition to on and off-site supervision, bank supervision can also be classified as: transaction based, consolidated and risk based supervision. On the other hand, regulatory tools/requirements include: Capital requirement, Reserve requirement, corporate governance, exposures restrictions and Financial reporting and disclosure requirements among other. The paper also showed that for the period of the study, the CBN has enacted and pushed through numerous regulatory and supervisory reforms for controlling the activities of banks in Nigeria including the consolidation and recapitalization of banks, altering the structure of banks to become universal in nature (involving in all sorts non-bank financial services) and back again to the original core banking and specialized banks license. The spate of regulatory reforms also witnessed the establishment of the AMCON and increasing the deposit insurance scheme. Core supervision was also not left out as more attention was paid to risk based supervision. Finally, the paper showed that over time, the supervisory and regulatory efforts of the CBN has paid off as the populace now has more confidence in the ability of the banks to withstand economic and financial shocks and continue operating. However, it is recommended that the CBN must continue to actively monitoring the both the internal and external economies and be proactive in proffering timely solutions to challenges that may arise.

1 INTRODUCTION

2.1 CONCEPT OF BANK SUPERVISION

TYPES OF BANK SUPERVISION

Transaction Based Supervision

Consolidated supervision

Risk Based Supervision

2.2 CONCEPT OF BANK REGULATION

2.2.1 INSTRUMENTS AND REQUIREMENTS OF BANK REGULATION

Capital requirement

Reserve requirement

Corporate governance

Large exposures restrictions

Financial reporting and disclosure requirements

2.3 REVIEW OF RELATED LITERATURE

Bank Regulatory and Supervisory Reforms 

3 DISCUSSION, CONCLUSION AND RECOMMENDATION

REFERENCES

Reference code P004
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