29 June 2012

Nigeria: Stakeholders Seek Enhance Code of Corporate Governance for Banks

Financial experts has called on the Central Bank of Nigeria (CBN) to introduce measures that would enhance corporate governance in the financial sector.

They told the News Agency of Nigeria (NAN) that the subsisting dismal corporate governance in the industry has prolonged the nation's financial crisis.

According to them, the near absence of corporate governance has eroded investors' confidence and made it difficult for the industry to recover fully from the 2008 crisis.

Mr Eddie Osarenkhoe, former President, Finance Houses Association of Nigeria (FHAN) said that CBN should adopt aggressive steps to prevent domination of banking sector by an individual or group of people.

"Banks Chief Executive use of excessive powers will only be curbed by the CBN ability to effectively implement corporate governance code in the banking industry," Osarenkhoe said.

He said that the code would engender check and balance for the restoration of investor's confidence to the industry.

Osarenkhoesaid that the CBNshould intensify efforts to ensure that the directive of the ten years tenure for managing director was strictly comply with by the banks.

He also suggested the imposition of stiffer penalties by CBN on erring banks that refuse to change their auditors as prescribe by the regulator.

Mr .Wole Olowu, General Manager, True Bond MicrofinanceBank Limited, said that lack of adequate supervision by CBNled to the 2008 nation's financial crisis.

He said that the CBN needed to strengthen its supervisory frame work, manpower and department toward meeting the challenges of a dynamic banking industry.

Olowusaid that the poor implementation of the financial industry supervisory policy would make the industry to remain in the woods. He also charged that CBN to introduce a stronger capacity building programme for its staff.

According to him, the programme would enable the workers to be ahead of commercial banks staff on contemporary banking industry issues and corporate governance. "The effective implementation of CBN policies to improve corporate governance in the financial sector will reduce the pressure in the industry," he said.


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