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Investor Presentaiton

The Country and its institutions Business Organisation and Regulation Labour and Social Security Regulations The Nigerian Financial Tax System Services Industry Foreign Exchange Transactions Investment in Nigeria Accounting and Auditing Requirements Importation of Goods Exportation of Goods COVID-19 Economic and Fiscal Measures The Nigerian financial services industry (FSI) is one the major sectors of the Nigerian economy. The structural transformation of the industry over the last decade is symbolised by: • the full autonomy of the Central Bank of Nigeria (CBN) under the CBN Act of 2007; • mandatory recapitalisation of banks; • emergence of microfinance banks; reversal of universal banking, giving way to divestment of banks from non-core banking businesses and emergence of bank holding companies; ⚫ industry stratification into national and regional banks, commercial and merchant banks; and the evolution of electronic banking. Besides, international banks are investing in Nigeria through acquisitions and start-ups just as Nigerian banks are making cross-border investments in representative offices, branches and full-fledged subsidiaries on the continent and international financial centres. The 2007 recapitalisation in the insurance sector led to industry consolidation and entry of foreign investors with the expectation that stronger operators will emerge in the industry. 4.1. Money Market Money market is based on the issuance of short-term securities by the CBN. These securities are taken up by banks and other financial institutions for further placement with individuals and businesses. The market is made up of: Regulators comprising CBN, NDIC and FMF • Banks and non-bank financial institutions As of the date of this publication, the money market comprised 22 commercial banks, 5 merchant banks, 2 non-interest banks, 911 micro-finance banks, 6 development finance institutions, 1 stock exchange, 3 commodity exchanges, 5 discount houses, 35 primary mortgage institutions, 45 finance companies, 2,991 bureaux de change³1, 14 life insurance companies, 28 general insurance companies, 13 composite insurance companies, 2 takaful insurance companies and 2 re- insurance companies³2. 4.1.1 4.1.2 Regulatory environment in the money market The market regulators are saddled with varying responsibilities to ensure a sound and efficient system. The responsibilities of the various regulatory agencies are summarised below: . The CBN is responsible for maintaining a sound and stable financial system; • • The NDIC is responsible for insuring deposit liabilities of licensed banks and assisting depositors in the event of financial difficulties on the part of the banks; and The FMF is responsible for administering the fiscal policies and controlling the finances of the federal government. Major statutes and regulations The main statutes and regulations applicable to the operators are: • CBN Act, 2007; KPMG • Banks and Other Financial Institution Act (BOFIA), Cap B3, LFN, 2020; CBN Regulation on the Scope of Banking Activities and Ancillary Activities, No. 3 of 2010 31 https://www.cbn.gov.ng/ Supervision/finstitutions.asp 32 www.naicom.gov.ng. However, some of these companies may merge or be acquired in order to meet the ongoing capitalisation requirements. Investment in Nigeria Guide - 8th Edition 38
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