Nigeria’s Banking Sector: Beyond the Reforms, What Role for CBN?

Abstract

Nigeria is undertaking another round of financial reforms as a result of crises experienced in the sector post-consolidation. The paper reviews the bank consolidation policy introduced in 2004 and the crises that followed it. It was concluded that weak supervision was the major cause of the crises which suggested a need for a review of not only the structure of the banking but also the regulatory architecture and the laws and regulations governing operations of the financial sector. It is suggested that a specialized agency be established to take over prudential supervision of all deposit-taking institutions and a council to oversee the coordination of activities of all regulatory agencies in the financial sector.