2013年-IMF国际货币组织全球_Nigeria_Publication_of_Financial_Sector_Assessment_Program_Documentation––Detailed_Assessment_of_Compliance_of_the_Basel_Core_Priciples_for_Effective_Banking_Supervision_153页_1mb

Summary of the Detailed Assessment of Compliance with the Basel Core Principles for Effective Banking Supervision in Nigeria (May 2013)

Core Content

This document presents a detailed assessment of Nigeria's compliance with the Basel Core Principles (BCP) for Effective Banking Supervision, conducted in 2012 as part of the Financial Sector Assessment Program (FSAP). The assessment focuses on the regulatory and supervisory framework, the structure of the financial system, and the effectiveness of banking supervision in the country.

Main Findings

• Legal and Regulatory Framework: Nigeria's banking supervision is governed by the Central Bank of Nigeria Act (2007), Nigeria Deposit Insurance Corporation Act (2006), and Banks and Other Financial Institutions Act (1991). These laws provide the foundation for the supervisory functions of the Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Corporation (NDIC).

• Supervisory Structure: The CBN is the primary regulator and supervisor of banks, while the NDIC oversees deposit insurance and collaborates with the CBN on bank supervision. Both institutions have separate off-site supervision in Abuja and on-site examination in Lagos. The Financial Services Regulation Coordinating Committee (FSRCC) coordinates regulatory activities across the sector.

• Market Structure: As of December 31, 2011, Nigeria had a diverse financial sector with:

  • 21 commercial banks (CBs)
  • 5 discount houses (DHs)
  • 876 microfinance banks (MFBs)
  • 107 insurance companies
  • 61 finance companies
  • 31 pension fund administrators
  • 1,946 bureaux de change (BDCs)
  • 690 securities brokerage firms

• Banking Sector Overview: The banking sector is the largest component of the financial system, representing 53.6% of GDP in 2011. Domestic banks control 86.4% of the sector's assets, while foreign institutions hold 13.6%. Four of the 21 banks are foreign-owned, and the rest are domestically controlled.

• Sector Performance: The banking sector showed signs of improvement in 2011, with:

  • Regulatory capital to risk-weighted assets ratio increasing to 17.8%
  • Tier 1 capital to risk-weighted assets ratio at 18.1%
  • Nonperforming loans (NPLs) to total loans ratio declining to 4.9% from 28.8% in 2010
  • Core liquid assets to total assets ratio rising to 25.7%
  • Liquidity ratio (liquid assets to short-term liabilities) increasing by 11.8 percentage points to 31.2%

• Banking Crisis: A major crisis in 2009 affected over 40% of banking sector assets. The crisis was attributed to:

  • Macro-economic instability due to large capital inflows
  • Corporate governance failures
  • Lack of investor and consumer sophistication
  • Inadequate disclosure and transparency
  • Regulatory gaps and uneven enforcement
  • Weaknesses in the CBN's governance and management
  • Unfavorable business environment

• Response to Crisis: The authorities implemented several measures to stabilize the sector, including:

  • Special examinations of all banks
  • Intervention in ten banks
  • Removal of senior management in eight banks and replacement with CBN appointees
  • Provision of N620 billion (US$4.1 billion) in liquidity support
  • Introduction of a blanket guarantee for interbank and foreign credit lines
  • Creation of AMCON (Asset Management Corporation of Nigeria) to resolve troubled banks
  • Mergers and acquisitions of intervened banks and the establishment of bridge banks
  • Increase in NDIC coverage of insured deposits to N500,000 for commercial banks and N200,000 for community banks

• Reforms and Improvements: Key reforms were introduced to align with international standards, including:

  • Abolition of the universal banking model in favor of a "back-to-basics" model
  • Implementation of risk-based supervision
  • Introduction of the Corporate Governance Code
  • Development of a regulatory roadmap for adopting International Financial Reporting Standards (IFRSs) and International Auditing Standards (ISAs)
  • Adoption of Basel II and Basel III standards

• Ongoing Challenges: Despite improvements, the sector still faces risks from:

  • Global and domestic economic conditions
  • Volatility in oil prices and international markets
  • Social unrest in the north
  • Security concerns from terrorist activity
  • Need for further regulatory and supervisory reforms

Key Recommendations

• Strengthen the regulatory framework to address critical gaps and ensure consistency.
• Enhance transparency and disclosure practices in the banking sector.
• Improve corporate governance and internal controls within banks.
• Implement stress testing and scenario analysis to better assess financial stability.
• Promote consolidated supervision and cross-border supervision mechanisms.
• Expand the capacity and resources of supervisory institutions to meet evolving challenges.
• Continue the process of financial deepening and market development to support sustainable growth.

Conclusion

The assessment highlights that while Nigeria has made significant progress in banking supervision, there is still room for improvement to ensure full compliance with the Basel Core Principles. The sector remains vulnerable to both global and domestic risks, and continued reform is essential to maintain stability and support long-term economic growth.