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 38View entire presentation