In a move clearly directed at reducing the autonomy of the Central Bank of Nigeria, the House of Representatives is working at transferring the role of bank supervision from the Central Bank to the Chartered Institute of Bankers (CIBN).
The Chairman, House Committee on Banking and Currency, Mr Jones Onyeyeri said that it had made the separation of banking supervision from other functions of the CBN a cardinal goal of the year 2013.
This is besides the fact that there is a bill currently pending before the House which seeks to amend the CBN Act 2007 by making its budget subject to National Assembly approval rather than by the board of the apex bank as it is currently. The bill also proposes to cut the membership of the board from 12 to seven and to appoint another person, other than the CBN governor, as the chairman of the board.
In the view of Onyeyeri, the core function of the CBN is meant to be monetary policy, but at present, it had become too focused on bank supervision.
“It is about time we hear from the CIBN, we are looking at that institute critically,” he said.
He added, “With the kind of challenges we have, it is time that we separated that function from the CBN. We could create an independent body, such as a Financial Supervisory Committee to deal with bank supervision. We need to hear from the CIBN and take it from there.”
Onyereri, who made these remarks at the special ACIB induction for the pioneering graduates of the Chartered Bank MBA of the institute, also urged the CIBN to contribute to issues of monetary policy, especially how to keep the Monetary Policy Rate (MPR) low as the present rate seems to be the reason banks keep their interest rates high.
While on the cashless policy by CBN, he said it should be allowed to transient down to significant reduction of charges by banks, stating that before moving to other states, CBN should allow the pilot scheme get to at least 80per cent of Lagos State.
Onyereri decried the underperformance of banks in granting loans to customers, while suggesting that the only way to break the barrier was through empowering the SMEs as CBN plans to bring intervention funds for Micro Finance Banks was a viable measure.
The Chairman House Committee on Banking and Currency further disclosed that when it resumes plenary in 2013, it would focus on cashless policy, financial inclusion, Micro finance banks, amending the NDIC Acts to make it stronger.