President Muhammadu Buhari has on Friday assented to the Banks and Other Financial Institutions Act 2020.
BOFI Act repeals the extant Banks and Other Financial Institutions Act 1991 as amended, and “updates the enabling law in response to developments and significant evolution in the financial sector over the last two decades”.
Senior Special Assistant to President Buhari, Garba Shehu in a statement on Friday explained that the Central Bank of Nigeria (CBN) will hold structured engagements with stakeholders across various sectors of the economy on critical aspects of the Act in the coming months.
Shehu, speaking on the benefit of the law, stated that;
This monumental piece of legislation is expected to enhance the soundness and resilience of the financial system for sustainable growth and development of the Nigerian economy.
It will increase the appetite of banks and other financial institutions to channel much-needed credit to the real sector to support economic recovery and promote sustainable growth.
He added;
Furthermore, it strengthens the regulatory and supervisory framework for the financial industry and provides additional tools for managing failing institutions and systemic distress to preserve financial stability amongst others.
The Act was passed by the Senate in July 2020 and it was sponsored by Shehu Sani, the Senator who represented Kaduna Central at the upper law-making body then and co-sponsored by Betty Apiafi (Rivers West).
It regulates the banking and businesses of other financial organizations by stopping them from carrying on such businesses in the country except they are a licensed company and incorporated in Nigeria.
Under the Act, the Governor of the Central Bank of Nigeria (CBN) can impose and review penalties on infractions in the banking sector up to the tune of N100 million.
With the Act, a Special Tribunal for the enforcement and recovery of eligible loans and also the quick resolution of loan-related matters can equally be created.
