 has directed bank directors with non-performing insider-related loans to step down immediately.){kind=link}
The Central Bank of Nigeria (CBN) has ordered bank directors with non-performing insider-related loans to step down immediately. This directive aims to strengthen corporate governance and improve risk management in the banking sector.
According to the CBN, insider loans refer to loans granted by a bank to its own executives, directors, employees, major shareholders, or related parties. To minimize financial risks, the apex bank instructed banks to recover debts through collateral enforcement and seize the shareholdings of affected directors.
The CBN also directed banks to comply with Section 19 of the Banking and Other Financial Institutions Act 2020, ensuring proper regulation of insider-related loans. Banks have 180 days to regularize insider-related facilities above prescribed limits.
Key highlights of the directive include:
– Immediate Resignation: Bank directors with non-performing insider-related loans must step down immediately.
– Debt Recovery: Banks must recover debts through collateral enforcement and seize shareholdings of affected directors.
– Regulatory Compliance: Banks must comply with Section 19 of the Banking and Other Financial Institutions Act 2020.
– Regularization: Banks have 180 days to regularize insider-related facilities above prescribed limits.