CBN Tightens Grip on Delinquent Loans, Banks Face Cleanup
By Nasir Dambatta
The Central Bank of Nigeria (CBN) has ordered the immediate removal of bank directors with non-performing insider loans in a sweeping crackdown on financial indiscipline.
In a directive signed by Adetona Adedeji, Acting Director of Banking Supervision, the apex bank mandated commercial banks to recover delinquent loans, including seizing the collateral and shareholdings of implicated directors.
The CBN also gave banks a 180-day deadline to realign insider-related credit exposures within statutory limits. Under the Banks and Other Financial Institutions Act (BOFIA), no single director’s insider loans should exceed 5% of a bank’s paid-up capital, while the total insider-related exposure must not surpass 10%.
This latest enforcement move is seen as a bold step to curb reckless insider lending and strengthen Nigeria’s banking sector against financial instability.
