The Nigerian First Published: May 1980

CIBN Journal of The Chartered Institute of Bankers of Nigeria, Oct - Dec, 2022. ISSN 0197-6679 N500.00

OPEN BANKING:
Benets to Africa Financial
Ecosystem
 i

The Nigerian Banker, Oct - Dec 2022 01

The Nigerian Banker, Oct - Dec 2022 02
 Akin Morakinyo, HCIB

CONTENTS Ndidi Olaosegba

Folake Akintayo

Abidemi Adeniji
Francis Agoh

Mary-Fidelis Abiahu, MCIB

Open Banking: Benefits to Africa
7 Financial Ecosystem Oyinbodare Oluwafemi

Strengthening Security Architecture in the

9 Financial Services Industry: The Role of
the 21st Century Security Practitioners

Radical Responses to Abnormal Episodes:

14 Time for Innovative Decision-Making

27 Regulatory Compliance With Regtech

Ethics and Professionalism in the

34 Nigerian Banking Sector: A Review of
Decided Cases

Intelligence-Gathering and the

41 Challenges of Insecurity in Nigeria

The Nigerian Banker, Oct - Dec 2022 03

 CIBN Governing Council (2022 - 2024)

Office Holders 21. Alhaji Aliyu Wada-Nas, ACIB

1. Ken Opara, Ph.D, FCIB Chairman, Kano State Branch
President/ Chairman of Council 22. Mr. A.S Mohammed
Chairman, Niger State Branch
2. Prof. Pius Oladeji Olanrewaju, Ph.D., FCIB
1st Vice President Banks' Representatives
3. Mr. Dele Alabi, FCIB 23. Mr. Ebenezer Onyeagwu, FCIB
2nd Vice President GMD/CEO, Zenith Bank Plc
4. Mrs. Moji Bakare-Asieru, FCIB 24. Dr. Adesola Kazeem Adeduntan, FCIB
National Treasurer MD/CEO, First Bank of Nig. Ltd
25. Mr. Hamid Joda, HCIB
MD/CEO, TAJ Bank Ltd
Representatives of the Body of Past Presidents
26. Mr. Elias Igbinakenzua, FCIB
5. Uche M. Olowu, Ph.D, mni, FCIB MD/CEO, Globus Bank Ltd
6. Dr. Bayo Olugbemi, FCIB 27. Mr. Nath Ude, FCIB
MD/CEO, Nova Merchant Bank Ltd
Other Elected Members 28. Mrs. Bukola Smith, HCIB
7. Mrs Rafiat Oluwatoyin Onitiri, ACIB MD/CEO, FSDH Merchant Bank Ltd
Elected Member
Institutional Representatives (Regulatory)
8. Dr. Godwin Adolor, FCIB 29. Mr. Godwin Emefiele, FCIB
Elected Member Governor, Central Bank of Nigeria (CBN)
9. Mr. Olayinka Odutola, FCIB 30. Mr. Hassan Bello, FCIB
Elected Member MD/CEO, Nigeria Deposit Insurance Corporation (NDIC)
10. Ms. Mary Aina, ACIB 31. Mrs. Zainab Shamsuna Ahmed
Elected Member Minister of Finance
Federal Ministry of Finance
11. Dr. Segun Anthony Oshadare, FCIB
Elected Member Institutional Representatives (Academic)
12. Dr. Victor Ndubuisi Agunwah, FCIB 32. Prof. Abubakar Adamu Rasheed
Elected Member Executive Secretary, National Universities Commission (NUC)
33. Prof. Idris Bugaje
Branch Representatives Executive Secretary, National Board for Technical Education (NBTE)
34. Mallam Adamu Adamu
13. Prof. Uchenna Uwaleke, ACIB
Minister of Education, Federal Ministry of Education
Chairman, FCT Branch
14. Mr. Peter Ashade, FCIB Sectorial Associations' Representatives
Chairman, Lagos State Branch 35. Mr. Ebilate Mac-Yoroki
15. Mrs. Funke Ladimeji, HCIB President Mortgage Bankers Association of Nigeria
Chairperson, Association of Professional 36. Mr Joshua Ukute, MCIB
President, National Association of Microfinance Bank
Women Bankers (APWB)
16. Mr. Rogers A Nwoke, HCIB, MCIB Co-opted Members
Chairman, Imo State Branch 37. Mrs Yvonne Isichei, FCIB - Co-opted Member
17. Mr. Charles Ojakovo, HCIB 38. Barr. (Mrs.) Toyin Ojo, FCIB - Co-opted Member
Chairman, Delta State Branch 39. Dr. Nosike Agokei, FCIB - Co-opted Member
18. Alhaji Kabir Mohammed Baba 40. Mrs. Risikatu Ahmed, FCIB - Co-opted Member
41. Dr. Iheanyichukwu Ogbonna, FCIB - Co-opted Member
Chairman, Bauchi State Branch
42. Mr. Ade Bajomo, HCIB - Co-opted Member
19. Mrs. Olabisi O. Okuyemi, FCIB
Chairman, United States of America Branch Secretary
20. Mr. Mayowa Adeyemo, ACIB 43. Akin Morakinyo, HCIB
Chairman, Ondo State Branch Registrar/Chief Executive

The Nigerian Banker, Oct - Dec 2022 04

 CIBN ANTHEM
C-I-B-N
Chartered Institute of Bankers of Nigeria
The Bankers' guiding light.
It's the Nation's joy and pride.
We aim for Integrity in the Industry
Upholding Ethics and Professionalism
Great! Great CIBN
Citadel of Excellence
Great! Great CIBN
Built on Trust and Honesty

C-I-B-N
Chartered Institute of Bankers of Nigeria
The wheel of economic growth
Competency is our goal
Creating value and building capacity
Fostering confidence in the industry
Great! Great! CIBN
The Bankers' guiding light
Great! Great! CIBN
Built on Trust and Honesty

The Nigerian Banker, Oct - Dec 2022 05

 Editor’s Note
During this quarter, the 6th Registrar/Chief Executive of The
Chartered Institute of Bankers of Nigeria, Sir 'Seye Awojobi,
Ph.D., FCIB, KJW retired from the services of the Institute
after a meritorious service that contributed greatly to the
repositioning of the Institute and the banking industry in
Nigeria. The 7th substantive Registrar/Chief Executive of the
Institute, Akin Morakinyo, HCIB, was appointed and
commenced his tenure on November 1, 2022.

In this edition, we present the Keynote Address delivered by

M. N. Atiku, Acting Director, Security Services, Central Bank
of Nigeria at the 15th Annual Retreat for the Chief Security
Officers of Bankers and other Financial Institutions held on
October 27, 2022, with the theme; "Strengthening Security
Architecture in the Financial Services Industry: The Role
of the 21 st Century Security Practitioners”, giving
Dear Esteemed Reader, extensive insight on the need and how to improve security
architecture in our financial services industry.
It is my pleasure to present to you the fourth edition of the
Nigerian Banker for 2022. The year 2022 has been quite a Also, we present to you the keynote Address by the Governor
challenging yet remarkable one for the Institute, the banking of Central Bank of Nigeria, Mr. Godwin Emefiele, CON, FCIB
industry and the Nigerian economy at large. at the 57th Annual Bankers' Dinner held at Eko Hotel and
Suites on November 25, 2022. The address highlighted key
The third edition of the Journal focused on the Mid-year issues towards monetary policy direction in Nigeria.
Review of the 2022 Economic Outlook and highlighted the key
challenges within the first half of the year which included rising Finally, this edition also features insightful and educative
inflation, degenerated infrastructure, forex challenges, articles on Open Banking: Benefits to Africa Financial
unsustainable cost profile as seen in debt servicing costs and Ecosystem; Regulatory Compliance with Regtech;
subsidy payments, lower-than-expected oil production levels Ethics and Professionalism in the Nigerian Banking
due to technical inefficiencies and oil theft, heightened Sector: A Review of Decided Cases; and Intelligence-
insecurity across the nation and massive wave of emigration gathering and the Challenges of Insecurity in Nigeria.
of young Nigerians for greener pastures.
As the year 2022 winds up, we await 2023 with great
During the quarter under review, the Nigerian economy expectations and are poised to deliver more value and
continued to scuffle against many of these challenges. achieve greater heights in line with our mandate.
However, efforts are being made by the Federal Government
to combat these challenges, especially through increased On behalf of the Governing Council, Management, and staff
funds allocated to the educational sector in the 2023 of the Chartered Institute of Bankers of Nigeria I wish you an
appropriation bill to further strengthen our educational system astounding festive season and a prosperous New Year in
and the solidification of border security by investing in more advance.
sophisticated security technologies.
I wish you an enlightening reading.
Also, the Central Bank of Nigeria on October 26, 2022,
announced its plan to redesign the 200-, 500- and 1000-Naira
Akin Morakinyo, HCIB
notes. The redesign of the Naira notes by the monetary apex
bank was intended to control currency in circulation, fight Registrar/Chief Executive
inflation as well as tighten money supply.

The Nigerian Banker, Oct - Dec 2022 06

Open Banking: Benets to Africa
Financial Ecosystem
Emeka Madu
Founder
RemitPlus

Open banking has become a major matter of

contention across the African continent, with investors In the US, there is insufcient standardisation and
and entrepreneurs betting on the tremendous regulation on nancial data, making it harder to
opportunities within this budding space. Open banking establish the exible, data-rich, and highly benecial
means providing third-party nancial providers access open banking systems available in Europe.
to key nancial data held by banks and other non-bank Nevertheless, despite lacking a nationwide open
institutions through data aggregation and APIs. The aim banking system or framework, the US has still
is to enable easier account networking and data access embraced open banking to offer better customisation
across multiple nancial institutions for use and benet of nancial products.
by nancial institutions, third-party providers, and
consumers. Other key benets of open banking in the US
include
Open banking in Europe and US • More convenient and faster payment methods
Europe is the leading continent in adopting and using • Better personalisation and control for consumers
open banking, spurred by robust ecosystems and well- • Automation
dened regulatory mandates. Open banking in Europe • Better targeting for businesses
is no longer about data-related technologies but about
leveraging data and APIs to facilitate friction-free, Other countries across the world are also steadily
secure payments with instant settling times. adopting market-driven or regulatory-driven open
banking solutions with varying objectives and benets.
Notable benets that have been seen from open Overall, banks and nancial institutions must recognise
banking in Europe include: that placing customers in full control of their nancial
• Enhanced nancial service offerings by data will be a regulatory and commercial imperative
leveraging open banking APIs going forward.
• Faster and smoother transactions for customers
Increased digital revenue through enhanced Open banking benets in Africa
customer engagement Banks and regulators in a few African countries have
• Increased transaction security and safety begun to explore the possibility of sharing customer

The Nigerian Banker, Oct - Dec 2022 07

and nancial data with various ntech upstarts. The promoting more transparent and faster interactions.
increasing open banking adoption across the continent
will have massive effects, just like the mobile payment The rich data source enabled through open banking
revolution a few years ago. All the benets of open will help providers accurately assess the customer's
banking, from faster payment processing to nancial creditworthiness and create a tting, cost-effective
product customisation, are features that a signicant, payment plan. Ultimately, buyers will get better
diverse pool of consumers needs in Africa. In addition, product options that save them money and experience
the large size and diversity of the underbanked and greater user convenience when comparing and
unbanked African marketplace offer a prime switching accounts between different providers.
environment for new ntech innovations.
Open banking can also help insurance rms in a
How Open banking can drive nancial inclusion in massive way, including through:
Africa • More customised insurance products through
Africa's banking systems have a high exclusion rate due the enhanced proling of customer data
to several factors. These include high costs, limited • Better customer onboarding processes through
credit systems, lower nancial literacy, and mistrust of the use of validated user information
traditional nancial institutions, among other factors. • Improved collection of insurance premiums
Open banking systems can help improve access to through a straightforward, direct debit API
nance for everyone across the continent by addressing connection to the banks
all those limitations. For instance, digital nance offers • Better consumer dialogues through proactive
better accessibility, lower costs, branchless operations, data-based advice and targeted marketing
the ability to ght prejudice, and comprehensive
customer data for better credit rating and access to Leveraging customer data can help insurance rms to
loans for consumers and SMEs. minimise risk by quickly identifying fraud, determining
client legitimacy, and ensuring compliance with
Why banks should not feel threatened with open industry regulations.
banking
Banks should not feel threatened about open banking to Conclusion
the extent of viewing third-party ntech rms as Even though open banking is relatively new and has not
competitors. They must shift their mindset and see been fully adopted across the world, it has a great
ntech companies as key enablers that will help them to
potential of transforming the entire African nancial
easily nd and get into business with a more diverse
ecosystem, from the banks and third-party providers
clientele. For example, loan companies can connect to
to the consumers. It will improve convenience,
the banks to share customer data, thus reducing the
transaction cost, and customisation and ensure
default rate, and the bank also earns by charging a small
effective nancial inclusion of Africans across the
access fee. That way, more SMEs and consumers will
continent.
have access to loans, which results in wealth creation.
Additionally, more people will be more willing to open
Banks and regulators should not feel threatened by
new bank accounts, thus creating a benecial cyclic
open banking; instead, they should innovate and nd
effect.
ways to implement it as early as possible. Better quality
nancial products, access to new markets, greater
Banks can also earn by allowing third-party providers to
customer retention, and high user satisfaction
aggregate user data to help clients to manage their
guaranteed by open banking in Africa are worth the
nances better. Banks and third-party vendors can earn
initiative and effort.
signicant amounts by providing such services. Open
access to nancial data can also increase operational
efciency and enhance customer experience by

The Nigerian Banker, Oct - Dec 2022 08

 Strengthening Security Architecture in the
Financial Services Industry: The Role of the
21st Century Security Practitioners
M. N. Atiku,
Acting Director, Security Services
Central Bank of Nigeria

1.0 Introduction strive to create a balance of care for our institutions,

As always, the theme of this year's retreat indexes the the nancial sector itself and our respective customers
sensitivity of the Chartered Institute of Bankers of given the challenge of systemic risks.
Nigeria and the Committee of Heads of Security of
Banks and Other Financial Institutions to the reality that Thirdly, experience and evidence have revealed that
confronts not only national security but also corporate the 21st Century security practitioner who knows only
or industrial security, and especially the nancial security is already doomed to fail. The modern-day
services industry. And I say this for the following security practitioner is not a security expert, as there
reasons. The focus on strengthening security clearly is no such qualication in its truest sense. Rather,
architecture is hinged on the fact that evidence points the 21st Century security practitioner is a professional
to the inability of textbook knowledge to adequately with varying degree of competence or expertise in
assist us in understanding the myriad security threats diverse areas, such as business analytics, inspirational
that confront us. This is because whatever architecture leadership, team building, risk analysis and
we build can easily be circumvented by the dynamic management, negotiation, cost-benet analysis,
nature of threats, if we are not introspective and decision science, critical thinking, nancial
proactive enough to continually explore equally management, vendor management, self-condence,
dynamic means of strengthening its structure, content, and use of technology, among others.
process, and function. Modern day security threats
challenge both statutory and non-statutory security The above truly embodies the relevance of this year's
apparatuses in ways we have never seen before. retreat theme.

Secondly, by focusing on the nancial services industry, 2.0 Security Architecture

we give recognition to the unique intermediary role the
industry plays in the lives of people across different Let us look at existing security architecture and its
sectors, a unique burden which confers on those of us needs for strengthening. The construct of an
who are practitioners in the sector the responsibility to architecture is best captured by design criteria that

A Keynote Paper delivered at the 15th Annual Retreat for the Chief Security Officers of Banks and
Other Financial Institutions in Nigeria held in October, 2022

The Nigerian Banker, Oct - Dec 2022 09

encompass structural features. So, when we talk about
security architecture, we are referring to the pattern or In 2016, the World Economic Forum posited that we
structured layers and parts that work together live in an age of disruption, that is, we stand on the brink
functionally to deliver security and safety for either an of a technological revolution that will fundamentally
organisation, a community, state or nation. To be alter the way we live, work, and relate to one another.
In its scale, scope and complexity, the transformation
meaningful, a security architecture must be
will be unlike anything humankind has experienced
intentionally designed, and not haphazardly developed
before.” Looking at this espousal, the question that
or implemented. This is the foundational problem that comes that we should all ponder is this: is there any
most security architecture faces. Often times, as nancial service institution in Nigeria today that is not
players in the nancial services industry, where the also a technology institution, that is, its operations and
need for our services prompt us to expand the space of value proposition to the customers are not
our offerings and the products, we add new branches, intermediated by technology? Absolutely none. If there
new personnel, and in doing this, we simply extend were to be any of such institution, it would have been
existing security architecture to accommodate the long extinct.
expanding business, without adopting an enterprise
It is therefore, on this premise that I posit that the
look at how the risks might have changed by simply
starting point in strengthening the security
adding a new staff not properly proled, a new branch
architecture of nancial services industry is to adopt an
established for political or economic interest, without enterprise security risk management framework as a
due consideration of security or threat prole, etc. security practitioner to manage security risks. As
professionals in the nancial services industry, we are
In effect, when we think of security architecture, it is very familiar with the Basel and risk-based supervision.
imperative that we think of this in the context of As Sapient (2018) noted, this requires companies to
integrated detective, preventive, protective and reinvent key business activities that taken together
response capabilities across each of our process or job create a new platform for the business that changes the
function and not in isolated parts, where the detective basis of risks and leads to change improvements in
part is left to internal audit or compliance or ofcially performance.
designated risk managers, preventive part to dual
control processes, protective to security or armed Enterprise Security Risk Management (ESRM)
guards and response to internal and external framework adopts risk management principles and
emergency response team. effectively apply these to security management, by
highlighting key elements for our consideration. First,
3.0 Strengthening Security Architecture in security must recognize that people are its centre.
Financial Services Industry Secondly, security is powered by data that hold
intelligence and thus must be powered by analytical
A nancial services institution (FSI) is a customer- capability. Thirdly, security should have predictive
prevention capability rather than be just reactionary.
focused or service-oriented establishment. That
Fourthly, security should have real-time adaptiveness,
means, it is in some ways serving the public, in the sense
with capability to deliver the right solution as and when
that during its hours of being open for business, it would
needed. Fifthly, security should have value proposition
practically accept anyone to come in and be served,
that is integral to the business, to ensure that the
except there is reasonable suspicion to do otherwise.
business runs smoothly with minimal interruption.
The intermediation role of the FSIs supports this, as
The ESRM feeds on information as a key asset. The
they are designed to intermediate in people's lives and
more information we gather about the security risks in
serve as infrastructure for economic development and
our business, the people we interact with, the slips, the
personal nancial stability. As an intermediary
trends, the environment, the market, the variety of
institution it plays critical role in building trust.
indicators that we consider as being relevant in

The Nigerian Banker, Oct - Dec 2022 10

achieving our organisation's mission and goals, the organisation on the other hand is an important index of
more we can build analytical intelligence to predict competence for modern day security professional.
threat outcomes and prevent their materialization. But
the value of information as a key asset lies not only in The 21st Century security practitioner is a business
gathering the data, but in our capacity to analyze them enabler, and not a facility manager, measured by the
effectively and meaningfully and protect them as critical capacity to evaluate business goals and associate
organisational asset from loss, abuse, alteration or business risks, map related security risks clearly at
inaccuracies. enterprise level, distribute and coordinate
responsibilities across the business, and maintain a
4.0 Role of the 21st Century Security strong overview of performance of the security
Professional function. To do this effectively, modern day security
practitioner, must step out and build new sets of
As the 21st Century security professional, what should capabilities in project management, critical thinking,
our role in strengthening security architecture be? I information management, business analytics,
think a starting point would be to recognize that competitive intelligence, inspirational leadership,
modern nancial services institution is a technology nancial management and technology, as elements of
platform, as there is heavy reliance on technology and these form the competency ecosystem for success as a
networked interaction with varied access privileges by security architect.
customers externally vis-à-vis internal employees. This
predisposes them to insider threats as well as external
risks. The idea is to strengthen understanding of its 5.0 Conclusion
vulnerabilities and focus on curbing as a means of
building resilience to stem tide, system breakdown and
Adopting and mainstreaming enterprise security risk
other cyber threats.
management as a strategic approach to organisational
resilience has the relevance of helping to identify
The next step would be to develop and apply a variety
security risks, document same, identify triggers and
of skill sets to deliver security. Such skill sets must be a
owners and develop effective mitigation interventions,
combination of more of soft skills than hard skills, while having an overview of progress. This also helps to
because people are at the centre of security service develop key security risk indicators, monitor
delivery and critical analysis will help us as professionals organisational threat prole in a dynamic manner and
to critically appraise the environment we operate in and proactively act as may be required. As a true builder,
evaluate objectively the linkages between the threats, you must think with the combined mindsets of the
our business mission and mitigation actions. For quantity surveyor, electrical, civil, mechanical engineer
instance, the Nigerian security threat prole as we to translate the architect's mind to reality. This is the
currently have is characterized by ood and mindset that the security architect must embrace to
displacement, terrorism, herders-farmers clashes, engage with the 21st century security challenges
banditry and abduction/kidnapping, separatist confronting the nancial services industry.
movements and activism, oil militancy and economic
sabotage, cultism and ritualism, heightened
unemployment/incidence of poverty and heated and
divisive political rivalry and activism. The capacity to
analyze these dimensions critically and exhaustively and
how they work in isolation and in a mix to impact the
nancial services industry on the one hand and your

The Nigerian Banker, Oct - Dec 2022 11

 Photos Speaks at the CIBN 2022 Fellowship Investiture
October 29, 2022

Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN
presenting the Certificate and Plaque of Investiture to Mr. Lamido Yuguda, presenting the Certificate and Plaque of Investiture to Mr. Mustapha
DG Securities and Exchange Commission Nigeria who was invested as a Ibrahim, ED, Nigeria Deposit Insurance Corporation - NDIC who was
distinguished Honorary Fellow of The Chartered Institute of Bankers of invested as a distinguished Honorary Fellow of The Chartered Institute of
Nigeria - CIBN at the 2022 CIBN Fellowship Investiture. Bankers of Nigeria - CIBN at the 2022 CIBN Fellowship Investiture.

Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN
presenting the Certificate and Plaque of Investiture to Mr. Hamid Joda, presenting the Certificate and Plaque of Investiture to Mr. Wole Adeniyi,
FCIB, MD/CEO Taj Bank Ltd who was invested as a distinguished MD/CEO Stanbic IBTC who was invested as a distinguished Honorary
Honorary Fellow of The Chartered Institute of Bankers of Nigeria at the Fellow of The Chartered Institute of Bankers of Nigeria at the 2022 CIBN
2022 CIBN Fellowship Investiture. Fellowship Investiture.

Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN
presenting the Certificate and Plaque of Investiture to Mr. Innocent Ike, presenting the Certificate and Plaque of Investiture to Mrs. Ireti Samuel-
Former, MD/CEO, Polaris Bank Ltd who was invested as a distinguished Ogbu, FCIB, MD/CEO Citibank Nigeria Ltd who was invested as a
Honorary Fellow of The Chartered Institute of Bankers of Nigeria at the distinguished Honorary Fellow of The Chartered Institute of Bankers of
2022 CIBN Fellowship Investiture. Nigeria at the 2022 CIBN Fellowship Investiture.

Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN Dr. ken Opara, Ph. D., FCIB, President/ Chairman of Council, CIBN
presenting the Certificate and Plaque of Investiture to Mr. Femi Bakare presenting the Certificate and Plaque of Investiture to Mrs. Yemisi Edun,
FCIB, MD/CEO Parallex Bank who was invested as a distinguished FCIB, MD/CEO First City Monument Bank who was invested as a
Honorary Fellow of The Chartered Institute of Bankers of Nigeria at the distinguished Honorary Fellow of The Chartered Institute of Bankers of
2022 CIBN Fellowship Investiture. Nigeria at the 2022 CIBN Fellowship Investiture.
The Nigerian Banker, Oct - Dec 2022 12
 Photos Speaks at the CIBN 2022 Fellowship Investiture
October 29, 2022

Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN
presenting the Certificate and Plaque of Investiture to Mr. Tawio Otiti, FCIB, presenting the Certificate and Plaque of Investiture to Mr. Mustafa Chike-
ED, FSDH Merchant Bank who was invested as a distinguished Honorary Obi, Chairman Bank Directors' Association of Nigeria - BDAN who was
Fellow of The Chartered Institute of Bankers of Nigeria at the 2022 CIBN invested as a distinguished Honorary Fellow of The Chartered Institute of
Fellowship Investiture. Bankers of Nigeria at the 2022 CIBN Fellowship Investiture

Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN
presenting the Certificate and Plaque of Investiture to Dr. Doyin Salami, presenting the Certificate and Plaque of Investiture to Mrs. Kafilat Araoye,
FCIB, Chairman, Kainos Edge Consulting Limited who was invested as a FCIB, MD/CEO Lotus Bank who was invested as a distinguished Honorary
distinguished Honorary Fellow of The Chartered Institute of Bankers of Fellow of The Chartered Institute of Bankers of Nigeria at the 2022 CIBN
Fellowship Investiture.
Nigeria at the 2022 CIBN Fellowship Investiture.

Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN
presenting the CIBN Crest to Mrs. Mosun Belo-Olusoga, HCIB, Principal presenting the Certificate and Plaque of Investiture to Mrs. Bukola Smith,
Consultant, KRC limited/Former Chairman, Access Bank and Special FCIB, MD/CEO FSDH Merchant Bank who was invested as a distinguished
Guest of Honor at 2022 CIBN Fellowship Investiture Honorary Fellow of The Chartered Institute of Bankers of Nigeria at the 2022
CIBN Fellowship Investiture.

Dr. ken Opara, Ph. D., FCIB, Dr. ken Opara, Ph. D., FCIB,
President/Chairman of Council, President/Chairman of Council,
CIBN presenting the CIBN Crest CIBN presenting the CIBN Crest to
Alhaji. Suleiman Barau, OON,
Dr. ken Opara, Ph. D., FCIB, President/Chairman of Council, CIBN presenting to Mr. Opuiyo Oforiokuma, FCIB, Chairman, Family Homes
the Certificate and Plaque of Investiture to Mr. Mike Ogbalu III, HCIB, CEO Senior Partner, @africa50 Funds Ltd/Former Deputy
Pan-African Payment and Settlement System (PAPSS) who was invested as a Infrastructure Acceleration Fund Governor, CBN and Chairman of
distinguished Honorary Fellow of The Chartered Institute of Bankers of and Guest Speaker at 2022 CIBN the Occasion at 2022 CIBN
Nigeria at the 2022 CIBN Fellowship Investiture. Fellowship Investiture Fellowship Investiture
The Nigerian Banker, Oct - Dec 2022 13
Radical Responses to Abnormal Episodes:
Time for Innovative Decision-Making
Mr. Godwin Emeele, CON, FCIB
Governor, Central Bank of Nigeria
senior management of the Bank who have all found
time to be here today .
Preamble
Distinguished ladies and gentlemen, as we are all
aware, the world is undergoing several Social and
Macroeconomic challenges; as the last few years
cannot, by any stretch of imagination be described as
normal following the series of headwinds that has
resulted in a downward revision of the global growth
outlook for 2022 and 2023 by the IMF. It is in light of
these disruptions, that the theme for today's event
“Radical Responses to Abnormal Episodes: Time for
Innovative Decision-making” is appropriate and well
timed.

Global Economy
During the early part of 2020, the world economy
experienced the most signicant downturn last
Opening Pleasantries— Good evening distinguished witnessed since the Great Depression following the
ladies and gentlemen. It is indeed a great pleasure to be outbreak of the Covid-19 pandemic, the effect of
with you this evening , and to once again, savor the which contracted global GDP by about 3.1 percent in
merry ambience of another convivial dinner aimed at 2020. Commodity prices went into a state of turmoil as
sharing with peers , colleagues and stakeholders in the the price of crude oil plunged by over 70 percent. In
Nigerian Financial System. As I have always maintained, addition, there was a signicant outow of funds from
banquets like this are valuable occasions for us to emerging market and developing economies like
momentarily recoil from the day-to day concerns of Nigeria, as investors sought safe haven assets like US
ination, recession, and Foreign exchange, and to treasury bills. This aggravated nancial conditions in
ultimately rethink the long term factors shaping the developing markets, leading to the depletion of
Nigerian Economy. external reserves and the weakening of the currencies
of a signicant number of emerging market countries
First, let me thank the leadership of the CIBN, led by Dr including Nigeria.
Ken Opara, the President of the Institute, and Dr 'Seye
Awojobi, the Registrar/Chief Executive, along with In a bid to contain the effects of the pandemic,
their team, for their diligence at putting this event unprecedented measures were taken, which involved
together. Also, I am immensely grateful to the Managing signicant amount of scal and monetary stimulus.
Directors of our banks and other nancial institutions as These measures helped to support a swift rebound in
well as my colleagues from the Central Bank of Nigeria, global growth in 2021. However, the swift rebound is
and these include the Deputy Governors and other now being constrained by the signicant supply

A Keynote Address delivered at the 57th Annual Bankers' Dinner - November 25, 2022

The Nigerian Banker, Oct - Dec 2022 14

disruptions in key producing nations like China, as 2022 and 2023.
factories now struggle to meet the upsurge in global
demand, along with other bottlenecks such as Today, in view of the food, energy, and cost-of-living
inadequate ships and containers to convey goods. This crises in many countries, we are witnessing growing
has resulted in a hike in freight rates from key restrictions on food exports from many countries. As
producing nations like China and ultimately an uptick in at the last count, about 23 countries, mainly in
imported ination. advanced economies, according to the World Bank
have banned the export of 33 food items. Seven other
As the world struggled to recover to pre-pandemic countries have additionally implemented various
conditions, the global economy was yet again hit by measures to limit food exports. To combat the
another adverse occurrence with the eruption of the debilitating energy crisis due to the war in Ukraine, the
Russian-Ukraine war. The war along with the sanctions European Union has developed plans to impose energy
placed on Russia by the US and its allies led to a spike in price caps, which has sparked Russia's threat to cut off
crude oil prices. Given the dominant role Russia plays as gas supplies. Germany is resorting to coal, in an
a key energy producer, energy prices spiked to over excruciating U-turn to its planned swift transition to
$120/barrel in March 2022 from a low of $14/barrel in green energy.
April 2020. In addition, Russia, and Ukraine's control of
a signicant share of wheat and fertilizer in the global Situating the Dilemma : A contextual anecdote.
market aggravated food prices. Distinguished Ladies and Gentlemen, these
tumultuous external conditions, reinforced by the
Global Response anomalous , sometimes Chaotic responses by many
In their attempt to contain the rising ination, Advanced countries, forebodes spill over shocks for Nigeria.
markets such as the US, began to increase their policy Again, this underscores my chosen theme and the need
rates, which led to a tightening of global nancial Market to ingeniously think outside the box for solutions and
conditions along with a signicant outow of funds from countervailing measures . At this juncture, let me put
emerging market countries. The subsequent the situation into perspective, as I recall the story of a
strengthening of the US dollar further aggravated young lady, her poor father and a despicable Money
inationary pressures, along with a weakening of lender.
currencies, and depletion of external reserves in many
emerging market countries. Today close to 80 percent A long time ago, a poor farmer named Feng, lived in a
of countries have reported heightened inationary small Chinese neighbourhood and owed money, which
pressures due to a conuence of some of the factors he could not repay to a local moneylender.
mentioned above. Unfortunately, the loan-shark, who was old and ugly
fancied the farmers gorgeous daughter called Mei. As
Central Banks in emerging markets and developing such, he crafted a devious scheme to bring his
economies in a bid to contain rising ination were also despicable purpose to fruition. The hideous
compelled to raise rates, which is expected to lead to a moneylender proposed to forgo the Feng's debt in
tapering of global growth over the next year. In fact, the return for marrying Mei, the farmer's beautiful
short-term global growth projections by the IMF have daughter. Neither the farmer nor his daughter could
been downgraded three times in 2022 and is likely to be conceal their disgust at this repulsive proposition.
below the 3.2 percent and 2.7 percent estimates for Sensing his victims' reluctance and in his scheming
2022 and 2023, respectively. cruelty, the crafty moneylender demanded that they
allow fate to determine the matter. He proposed to put
Average growth among advanced economies is a black pebble and a white pebble into an empty
projected to plunge from 5.2 percent in 2021 to 2.4 opaque leather sack, one of which pebble , Mei must
percent in 2022 and 1.1 percent in 2023. Estimated then randomly pick from the bag.
output growth in emerging markets, is expected to
slow from 6.6 percent in 2021 to 3.7 percent apiece in By his evil plot, if Mei picked the black pebble, she

The Nigerian Banker, Oct - Dec 2022 15

would become his wife and her father's debt would be especially in view of the steep consequences of the
instantly and entirely cancelled. However, if she three logical possibilities above.
happened to select the white pebble, she will be free
not to marry him, and her father's debt will still be Domestic Developments
forgiven. But if she failed to pick any of the two pebbles, Ladies and gentlemen, the predicaments confronting
her father's debt will be upheld, and her defaulting Mei in the story parallel those beleaguering our
father will be thrown into jail. Wow!!! What an domestic economy today. Given Nigeria's fundamental
agonisingly grim moment for Mei and her poor father,
vulnerabilities, it is imperative to nd sustainable ways
who at this point, had realised how precarious their
of insulating the economy from continued exogenous
options were and how appalling the money lender is.
They had no choice but to accept the devious man's challenges. In addition to the relentless waves of
plan and leave their fate to providence. abnormal shocks that is battering the global economy,
domestic conditions are exposed to spill overs from
As they stood , discussing the pebble strewn path along the impulsive reactions in some key economies. It
the farmer's eld, the money-lender bent down to pick therefore behoves us to adequately identify and
up two pebbles. The smart and eagle eyed girl noticed understand the likely implications of these
that the wicked loan shack had deceitfully placed two u n d e r c u r r e n t s o n t h e N i g e r i a n e c o n o m y.
black pebbles in the bag ( rather than one white and one
Unfortunately, the Nigerian economy was not
black as agreed). Not realising that his malicious act was
insulated from the spill over effects of these shocks,
spotted, the dubious old man then asked the girl to pick
a pebble from the bag. even though some of the actions taken by the
monetary and scal authorities helped to cushion its
What a truly precarious situation the girl found herself. effects on our economy. Based on this, the economy
She was confronted with a gravely anomalous has remained resilient in the face of enormous
predicament, whilst her father remained innocently vulnerability. Following the brief recession in Q2 of
oblivious of the real extent of the impending 2020, the Nigerian economy has recorded eight
malevolence. Now, imagine that you were the one consecutive quarters of positive output with domestic
standing in the eld. What would you have done if you
growth rates improving from negative 1.92 percent in
were the girl? If you were to advise her, what would you
have told her? How should she deal with this abnormal,
tricky and potentially doomed option?
This performance reected the sustained buoyancy of
A quick reection indicates three possible responses by
Mei. First, in remonstration of the man's dishonesty, she the domestic non-oil sector, which continued to
could refuse to pick a pebble. Secondly, she could show record growth since 2020q4, recovering from negative
that there were two black pebbles in the bag and 1.25 percent in 2020 to 4.77 percent in 2022q2.
expose the moneylender as a cheat. Finally, she could. Performance of the non-oil sector reects the impact
out of fear, naively pick the black pebble and sacrice of policy supports to household, MSMEs and other
herself in order to save her father from imprisonment. high-impact economic sectors through various CBN
But any of these three actions will have untold
interventions. Specically, we have seen a
repercussions; after all, her father is a defaulting
borrower. Mei needed to nd a nonconfrontational, strengthening of the agriculture and services sectors
non-abrasive and smooth solution to her dilemma. I will which have continued to propel domestic growth rate
pause the story here for us to contemplate a resolution throughout this period while the oil sector has
of the puzzle . The foregoing story aims to highlight the continued to ounder with growth rate plunging to
difference between lateral thinking (that is, imaginative) negative 11.77 percent in 2022q2.
and Logical (that is, common sense). The girl's
predicament cannot be solved with traditional actions,

The Nigerian Banker, Oct - Dec 2022 16

 Figure 2: Key Sectoral GDP Growth Rates (%) Figure 4: Domestic Ination Pattern (%)

Food remains the major component of domestic

The agriculture sector remained the critical factor consumer price basket. The annualised uptick in
behind the continuing resilience of the domestic headline ination mirrors the 6.21 percentage points
economy. This is an afrmation of the success of the upsurge in food ination to 23.34 percent in
CBN's development nance initiatives in the nonoil September. During this period, core ination also
sector, particularly in the agriculture sector, which has resumed an upward movement from 13.87 percent in
helped to boost domestic output and create jobs locally. January 2022 to 17.60 percent. In addition to harsh
global spill overs, exchange rate adjustments and
Crude Oil Price and Production: While global imported ination; ination was also driven by local
developments steadily drove crude oil prices upwards factors such as farmer herder clashes in parts of the
in 2022, Nigeria's oil sector performance has been food belt region. Noting the adverse effect of spiralling
abysmal. This reected the country's inability to meet ination on inertia and expectations, the CBN
its meagre production quota as recorded domestic understands the need for supply-side interventions in
crude oil production plunged from over 1.9 million critical sectors to minimise excess demand gaps.
barrels per day as of April 2020 to 1.1 million barrels per
day by September 2022. Given our dependence on Real Sector Indicators: Key indices presented mixed
crude oil for close to 80 percent of our foreign outcomes in the real sector activities regarding
exchange earnings, the drop in production has resulted industries, manufacturing, agriculture, mining, and
in a signicant drop in our foreign exchange earnings as electricity production. Purchasing Managers' Index
well as government revenue. It is imperative that we (PMI) suggest fragile resilience of the domestic
diversify away from the oil sector, to reduce our economy as tight global conditions and rising
exposures to the volatilities associated with inationary pressures weighed down domestic
dependence on revenues from the sale of crude oil. economic activities. Composite PMI contracted from
50.0 points in June 2022 to 49.5 points in September
Ination: Upside pressure on consumer ination re- 2022 dragged by the weaknesses in both the PMIs for
emerged during the year, as global conditions industry and services which declined to 46.5 and 47.7
complicated existing local imbalances to undermine points, respectively.
price stability. After a successive period of decline in
2021, due to balanced monetary policy actions, Our manufacturing sector, MSMEs, and the services
domestic ination rate commenced an upward sector need to be reinforced to, not only support
momentum in 2022, consistent with global trends. domestic needs but to also become internationally
From 15.60 percent in January 2022, headline ination competitive. This is in view of the massive supply chain
soared to 20.77 percent in September 2022, indicating disruptions that exposed the dependence and
eight consecutive months of uptick. vulnerability of many EMDEs to overseas economies.

The Nigerian Banker, Oct - Dec 2022 17

Private Sector Credit: The recent drive of the CBN to downward short-run trend of the external reserves
channel more cheap lending to the real sector has led reappeared at the beginning of 2022. Accordingly, after
to marked growth of banking system credits to the recovery from US$33.7 billion in March 2020 to
private sector. In support of domestic productivity, US$41.6 billion in September 2021, ofcial reserves fell
credit to the core private sector of the economy has to about US$37 billion as at October 2022. At
more than doubled, in the last ve years, expanding approximately 6.4 months, import cover in October
from N13.2 trillion at end-2018, to N16.2 trillion at remained above the traditional 3-months threshold.
end-2019, before surging to N27.7 trillion as at This reected the massive demand pressure mounted
September 2022. on the foreign exchange market, as import appetite
remained high vis-à-vis available foreign reserves.

Figure 6: Credit to the Core Private Sector Figure 7: Exchange Market Development

During this period, the foreign exchange market

As illustrated by the credit-to-GDP ratio, this development exerted considerable pressure on the
phenomenal growth is not nominal but rather deep- naira-dollar exchange rate, notwithstanding the
rooted support of the real economy. As a ratio of GDP, enormous effort of the CBN to stabilise the exchange
credit to core real sector grew from 9.4 percent at end- rate. Over the medium-term, the incessant demand
2018, to almost 15 percent as of September 2022. It is pressures at the foreign exchange market moved the
our objective to gradually drive this ratio above 50 exchange rate from about N381/US$ at end-2020 to
percent to ensure adequate support of real economic N416/US$ in January 2022 and further to N440.9/US$
activities in Nigeria and concurrently deepen the today, a cumulative 5.6 percent depreciation year-to-
nancial sector contributions to the development of date.
our country.
Capital Flows: With the upsurge in global ination,
Banking Sector: Notwithstanding the global headwinds, which have reached record heights in advanced
our banking sector continues to remain sound and countries, the ensuing global monetary tightening is
accommodative of growth. NPL ratios are currently threatening global macroeconomic conditions. In
under 5 percent and the Capital Adequacy and liquidity Nigeria, this threat is considerably muted due to a low
ratios are above the prudential requirements at 13 and amplitude of capital ows since 2020. Monthly average
40 percent, respectively. We intend to continue to capital outows from Nigeria year-to-date is less than
maintain strong oversight of our banking institutions to one-third of its value in 2019 having declined from
quickly identify any vulnerabilities and ensure that banks US$1.37 billion monthly to US$0.58 billion monthly in
take suitable measures to mitigate any potential risks. 2022. It is thus imperative for us to ensure, through
innovative inward-looking structural policies, that we
Foreign Exchange: The Drop in oil receipts along with nd sustainable ways of adequately insulating the
tightening of global nancial market conditions have economy from the volatility associated with foreign
weighed heavily on our foreign exchange market. The portfolio ows.

The Nigerian Banker, Oct - Dec 2022 18

Figure 8: Capital Flows (US$ Billion) exchange. As we all know, for example, the ofcial
foreign exchange receipt from crude oil sales into our
ofcial reserves has dried up steadily from above
US$3.0 billion monthly in 2014 to an absolute zero
dollars today.

To put this drawback into perspective, it is equally no

news that the number of student visa issued to
Nigerians by the UK alone has increased from an
annual average of about 8,000 visas as of 2020 to nearly
66,000 in 2022, which implies an eight-folds surge to
about US$2.5 billion annually in study-related foreign
CBN Countervailing Policy Measures exchange outow to the UK alone. It is against the
backdrop of the worsening mismatch between foreign
Distinguished guests, the prevailing circumstances exchange market demand and supply, and the need to
present a dilemma for policy makers. Higher ination boost foreign exchange earnings that the CBN and the
needs to be tackled with tools that can potentially Bankers' Committee initiated the RT200 programme
constrain our fragile output growth and cause in February 2022.
stagation. At the CBN, this pursuit of a balanced mix of
established and unconventional policy measures The programme was fundamentally devised to
remains the crux of our macroeconomic management innovatively tackle the fundamental problem
strategy and to forestall any harmful future impact, the associated with the repatriation of non-oil export
CBN took and will continue to take proactive measures proceed. So far, we have recorded and continue to
for the good of the economy. Some of the record resounding success with the RT200
countervailing measures we took over the past few Programme. Inows through this programme in 2022
months, to chart a path for sustainable advancement rose to about US$1.6 billion and could surpass US$2.5
are listed below. billion by year-end. Under the rebate scheme of the
programme, the Bank has reimbursed a total of N78.4
Monetary Policy: After a prolonged period of monetary billion naira, which I consider a fair price to incur to
accommodation, aimed at supporting the productive stabilise our foreign exchange market.
sector of the Nigeria economy, the Monetary Policy
Committee of the CBN reconsidered it stance as Prior to the RT200 programme, the CBN had also
ination pressures resurfaced. Consequently, with the rolled out several initiatives to bolster the inow of
resumed uptick of ination rate in February 2022, the foreign exchange into Nigeria in a stable and
MPC has raised its policy rate four times from 11.5 sustainable manner. One of these, as you may
percent to 16.5 percent in November 2022. With the recollect, is the Naira-4-Dollar scheme. This initiative
cumulative hike of 500 basis points, so far in 2022, we reects our efforts to boost migrant remittances into
are condent of an ensuing period of sustained the Nigeria economy. I am happy to note that, so far,
disination. The cycle of monetary tightening could, the Naira-for-Dollar scheme has been successful in
however, impinge on growth momentum if adequate increasing remittance inows through our registered
supportive and structural measures are not quickly International Money Transfer Organization (IMTOs).
implemented.
Foreign Exchange Management - RT200: The Nigerian Currency Redesign: Based on the ever-escalating
foreign exchange market is in the middle of serious challenges that are inundating currency management in
crunch which are straining our reserves and stiing the Nigeria, with grim consequences for our sovereign
value of the naira. Market demand for both goods and integrity, the CBN recently announced its policy to
invisible transactions has continued to increase under issue newly redesigned Nigerian banknotes. Analysis of
various uses in the face of dwindling supply of foreign the key challenges primarily indicated a signicant

The Nigerian Banker, Oct - Dec 2022 19

hoarding of banknotes, as over 85 percent of currency schemes. The scheme is expected to commence on 16
in circulation were held outside banking system. This is January 2023. With this, Nigeria will join a growing list
even as currency in circulation more than doubled from of EMDEs (including India, Turkey, China, and Brazil)
N1.46 trillion in December 2015 to N3.23 trillion in that have launched domestic card schemes. This
September 2022; a worrisome trend that must be landmark initiative shall position Nigeria as the rst
curbed. Whilst the global best practice is to undertake African country to introduce a domestic card scheme,
currency redesign every 5–8 years, our existing that combines a fully domestic infrastructure with
banknotes have remained unchanged in almost two international interoperability.
decade 20 years. It is therefore no longer tenable to
continue with business as usual; especially given the Development Finance: To support productivity in view
continually evolving circumstances that could impinge of the ongoing external threats and, especially, to
the optimal performance of the Naira.It is against this correct some of the existing structural failures of the
backdrop and congruent with relevant sections of the Nigerian economy, the CBN sustained its various
CBN Act 2007, that the CBN sought and obtained the interventions. Essentially, these focused on stimulating
approval of President Muhammadu Buhari to redesign productivity in manufacturing sector, bolstering
the N200, N500, and N1,000 banknotes. This policy domestic industries, revolutionising agricultural output
will quicken the attainment of cashless economy as it is to ensure self-sufciency and shield the local economy
complemented by increased minting of our eNaira. It from harmful external shocks.
will curtail currency outside the banking system and, as
monetary policy becomes more efcacious, help to rein A breakdown of some of the activities in the agriculture
in ination. sector indicated that between July and August 2022,
under the Anchor Borrowers' Programme (ABP), the
Digital Money and Payments: Given the rapid Bank disbursed N54.82 billion to several agricultural
advancements in nancial technology leading to rapid projects, bringing the cumulative disbursements under
digitisation of money and nance, the CBN will the Programme to N1,026.27 trillion to over 4.6
continue to seek creative ways to ensure that Nigeria million smallholder farmers cultivating 21 different
takes full advantage of its opportunities and benets, commodities across the country. The Bank also
leading to the recent launch of the eNaira. The eNaira released N0.70 billion to nance large-scale
was developed to broaden the payment possibilities of agricultural projects under the Commercial
Nigerians, foster digital nancial inclusion, with Agriculture Credit Scheme (CACS), bringing the total
potential for fast-tracking intergovernmental and social disbursements under the Scheme to N745.02 billion
transfers. Since its launch a year ago we have continually for 679 projects in agro-production and agro-
modied its features and have made it more accessible processing.
to wide range of users. Today, you do not need a
smartphone to use the eNaira as it has become In addition, the Bank released the sum of N66.99 billion
compatible with all generations of mobile devices (old under the N1.0 trillion Real Sector Facility to 12
and new). So far, a total of N8 billion, consisting over additional projects in manufacturing and agriculture.
700,000 transactions, has passed through the eNaira Furthermore, under the 100 for 100 Policy on
platform. Production and Productivity (PPP), the Bank has
disbursed the sum of N20.17 billion to 14 projects in
To further strengthen the payments system while healthcare, manufacturing, and services. This brings
conserving foreign exchange, the CBN is collaborating the cumulative disbursements under the facility to
with the Nigerian Inter-Bank Settlement System N93.39 billion to 62 projects across manufacturing,
(NIBSS) to launch The National Domestic Card agriculture, healthcare, and services. As part of efforts
Scheme. This is expected to lower operating costs for to help resuscitate Nigeria's textile industry and
banks incurring huge charges for foreign card schemes. promote economic development in the textile and
It will also reduce the huge foreign exchange garment sector, the Bank released the sum of N1.50
commitments associated with operating foreign card billion under the textile sector intervention facility

The Nigerian Banker, Oct - Dec 2022 20

(TSIF), bringing the total disbursements under the Interestingly, in terms of the pace of ination
scheme to N97.80 billion. acceleration, Nigeria rate is among the slowest, as
ination grew from about 16 percent in October 2021
In support of the resilience of the healthcare sector, the to 21.09 percent. Over the same interval, Morocco's
Bank also disbursed 4.00 billion to two (2) healthcare ination rate rose ve folds from 1.7 percent to 8.3
projects under the Healthcare Sector Intervention percent. The rate in Ghana rose more than three folds
Facility (HSIF), bringing the cumulative disbursements from 11 percent to 37.2 percent. Outlook and Policy
to N130.54 billion for 131 projects, comprising 32 Thrust for 2023
pharmaceuticals, 60 hospital and 39 other services.
Under the export development fund (EDF) and export Distinguished guests, ladies, and gentlemen. The short-
facilitation initiative (EFI), the Bank funded several term outlook of the global economy is increasingly
bleak as the lingering effects of the pandemic-induced
projects for non-oil export commodity value-addition
supply chain disruptions and economic fragmentation
and production with the sums of N11.89 billion and
is worsened by the uncertainties triggered by the
N3.24 billion, respectively. In the MSME sector, the
eruption of the Russian-Ukraine war.
bank supported entrepreneurship development with
the disbursement of the sum of N39.26 million to youth
Accordingly, the IMF projects that more than a third of
under the tertiary institutions entrepreneurship the global economies will suffer a recession within the
scheme (TIES), bringing the total disbursement under next two years, especially as the US, EU and Chinese
this intervention to N332.43 million. economies stagnate. In emerging markets, growth
Comparative Emerging Markets Assessment forecasts have been revised downward for China,
India, Mexico, Turkey, and South Africa reecting
Ladies and gentlemen, an analysis of our recovery country-specic factors, uncertainties in the nancial
efforts and current outcomes suggest that the Nigerian conditions, and rising spillover effects of global
economy and its banking system has faired comparably geopolitical tensions. As external conditions ounders,
well when juxtaposed with peers. Like many EMDEs, inationary pressure is expected to worsen and
Nigeria's GDP growth rate has so far remained positive become more persistent in many economies. The rate
even as global conditions plunge deeper into stormy in key advanced economies is projected to remain
waters. Ination rates among comparator economies historically elevated at double digit levels up to the
have however soared in consonance with global trends. 2023q3 at the earliest. As such, tight monetary
A quick comparison of the rates for September 2022 conditions will remain prevalent over the short-term,
indicates that Nigeria's ination, at 20.77 percent, is straining nancial markets in many EMDEs and
high but not among the worst. We have seen hyper exacerbating the underlying vulnerabilities.
inations, above 80 percent, in Turkey and Argentina.
Ghana and Ethiopia also had rates above 30 percent. Considering the current developments in both the
global and domestic economies, and based on
Figure 9: Ination Rates in Selected EMDEs extensive simulations, the CBN is of the view that the
short-term outlook of the Nigerian economy remains
good. We expect that:
· Monetary policy: Over the coming years,
monetary policy will remain focused on the
objectives of price, monetary, and exchange rate
stability. Our policy stance will, accordingly, remain
tight to curtail ination pressure, regulate capital
ows, and buoy the naira-dollar exchange rate.
Monetary policy decisions will remain balanced,
judicious, research driven, adequate and
supportive of the real economy subject to
underlying fundamentals. We will maintain the
current tight Monetary Policy stance in the near-

The Nigerian Banker, Oct - Dec 2022 21

 term, especially in view of rising ination to remain positive in the short-term. We have seen
expectations and exchange market pressures. a recent boost in non-oil exports receipts to about
Though we will act to appropriately adjust the US$2.5 billion. Hoping that the poor performance
policy rate in line with unfolding conditions and of the oil sector reverses, especially as high crude
outlooks. prices is sustained by a potential elongation of the
· GDP: Based on the expectation of a robust non-oil Russian-Ukraine war, we expect the Current
performance, and barring any unforeseen shocks, Account Balance to strengthen even further. This
GDP growth rate is projected to remain positive in will be backed by our resolute effort to strengthen
the remaining quarter of 2022 and during 2023. The and improve real non-oil sector productivity
performance of the non-oil sector will be buoyed through apt diversication to reduce undue
by the continued efforts at entrenching indigenous imports.
productivity in high-impact real sector activities,
especially agriculture, MSMEs, and manufacturing. Given the global and domestic headwinds we face as a
Domestic aggregate demand is further expected to nation, and the volatility in the global environment, we
be bolstered by the anticipated budgetary outlay have no other option, as leaders interested in the
and the surge of electioneering spending in the next progress of our nation, but to work very hard to spur
few months. From 3.54 percent in quarter two of job creation by reviving agricultural and industrial
2022, growth is projected to reach 3.7 percent in activities in the country. Like I have said many times
quarter three and 3.47 by the fourth quarter. before, if we continue to support the growth of small
· Ination: Ination expectations are rising as existing holder farmers, you can only imagine the amount of
structural rigidities, are compounded by global wealth and jobs that will be created in the country. If we
factors and anticipated elections related liquidity turn a blind eye to the opportunities provided by our
upsurge. For the rest of 2022 and towards mid- enormous human and material resources, this could
2023 Nigeria's rate of ination is projected to spell doom for our nation.
remain elevated and above the 12.5 percent
growth-aiding threshold. However, on the Concluding Remarks
backdrop of our previous policy measures, and as Distinguished ladies and gentlemen. In concluding my
the effect continue to permeate the system, our remarks, please permit to say that over the last two
inhouse model-based simulations indicate that years, the global order and macroeconomic conditions
ination rate could fall steadily to less than 15 have become increasingly challenging and distressfully
percent by end-2023. tumultuous. These portend a huge downside risk for
· Exchange Rate: Though the CBN has so far the prospect of the Nigerian economy. We are thus
managed to maintain exchange rate stability, the reminded of the need to look inward in developing
current capital ow reversals from emerging policies that will correct the fundamental failures that
markets are expected to continue to exert have undermined our economy. Accordingly, the CBN,
guided by best judgement and data will continue to act
considerable pressure on market rates. This
in good faith to ensure the increased prosperity of the
pressure could be amplied by the forthcoming
Nigerian economy. As I wind down my address this
elections, especially as the political marketplace
evening, I call on all of us, to put on our thinking caps,
heats up. Notwithstanding these pressures, the
and nd imaginative solutions that will ensure a Nigeria
CBN is determined to maintain its stable exchange
of our dream, where balanced growth and shared
policy stance over the next few months through
prosperity is guaranteed for all.
innovative policy measures to manage the demand
and supply of foreign exchange. If the current
I thank you very much for your attention. And thank
problem of oil theft is promptly corrected, we
you once again, for being here today.
could expect a resumed inow of crude oil receipts
into the ofcial reserves. This could foster gross
Godwin I. Emeele, CON
stability in the foreign exchange market and
Governor, Central Bank of Nigeria
enhance exchange rate stability.
· BOP: Overall our balance of payments is expected
25 November 2022

The Nigerian Banker, Oct - Dec 2022 22

The Nigerian Banker, Oct - Dec 2022 23
 Photos Speaks at the 57th Annual Banker’s Dinner
November 25th, 2022

Mr. Godwin Emefiele, CON, FCIB, Governor, Central Bank Dr. ken Opara, FCIB, President/ Chairman of Council,
of Nigeria delivering the Keynote Address at the 57th CIBN delivering the welcome address at the 57th Annual
Annual Bankers Dinner. Bankers Dinner.

Mr. Ebenezer Onyeagwu, FCIB, Chairman, Adhoc Committee on

Mr. Akin Morakinyo, HCIB, Registrar/CE, CIBN giving the Annual Bankers Dinner/Chairman, Body of Banks’ CEOs & GMD,
vote of thanks at the 57th Annual Bankers Dinner Zenith Bank Plc welcoming the Special Guest of Honour at the 57th
Annual Bankers Dinner.

Mr. Godwin Emefiele, CON, FCIB, Governor, Central Bank of Mr. Godwin Emefiele, CON, FCIB, Governor, Central Bank of
Nigeria presenting the plaque to the next Generation Class of Nigeria presenting the plaque to the next Generation Class of
2022 2022

The Nigerian Banker, Oct - Dec 2022 24

 Photos Speaks at the 57th Annual Banker’s Dinner
November 25th, 2022

Mrs. Aishah Ahmed, FCIB, Deputy Governor, CBN and Mr. Godwin Emefiele, CON, FCIB, Governor, Central Bank
Dr. ken Opara, FCIB, President/ Chairman of Council, of Nigeria presenting the winner of the raffle draw with the
CIBN presenting the X-factor award to Chetachi Ezenagu grand prize (Iphone 14 Pro Max)
at the 57th Annual Bankers Dinner.

Mr. Ebenezer Onyeagwu, FCIB, Chairman, Adhoc Committee on Annual

Bankers Dinner/Chairman Body of Banks’ CEOs & GMD, Zenith Bank
Plc; Mr. Hassan Bello, FCIB, MD, NDIC; - Mr. Godwin Emefiele, CON,
Mr. Hassan Bello, FCIB, MD, NDIC; Mr. Godwin Emefiele, FCIB, Governor, Central Bank of Nigeria; Dr. ken Opara, FCIB,
CON, FCIB, Governor, Central Bank of Nigeria; Dr. ken Opara, President/Chairman of Council, CIBN; Mrs. Mojisola Adebisi Bakare-
FCIB, President/Chairman of Council, CIBN and Mr. Akin Asieru, FCIB, National Treasurer, CIBN; Prof. Pius Olanrewaju, FCIB,
Morakinyo, HCIB, Registrar/CE, CIBN 1st Vice President, CIBN

Mr. Samuel Avwerosuo Egube, Lagos State Commissioner for

Economic Planning and Budget; Mrs. Ngozi Opara, Dr. ken Opara, Ph. Mr. Godwin Emefiele, CON, FCIB, Governor, Central
D., FCIB, President/Chairman of Council, CIBN; Mr. Godwin Bank of Nigeria randomly selects the winning ticket from
Emefiele, CON, FCIB, Governor, Central Bank of Nigeria the raffle draw.

The Nigerian Banker, Oct - Dec 2022 25

The Nigerian Banker, Oct - Dec 2022 26
REGULATORY COMPLIANCE WITH REGTECH
Emomotimi Agama
Managing Director
Nigerian Capital Market Institute

Introduction nancial sector rms should think about as they look

The success of the nancial services sector is into and use RegTech solutions.
fundamentally supported by regulation, which
guarantees investor protection and market integrity. Role of RegTech
Regulations have changed throughout the past century, Although there is no universally accepted meaning of
both domestically and internationally, to keep up with the word "RegTech," it is typically used to refer to
the nancial markets' increasing sophistication, speed, cutting-edge technology created to make it easier for
and complexity. Financial services companies are market participants to comply with regulatory
turning to new and creative regulatory technology requirements. The Institute of International Finance
(RegTech) tools to help them satisfy their commitments says that RegTech is "the use of new technologies to
in an effective and efcient way as they try to keep up solve regulatory and compliance problems in a more
with regulatory compliance standards. These RegTech effective and efcient way.”
tools could make it easier for businesses to improve
their compliance strategies, which could lead to safer RegTech technologies are becoming more and more
markets and better returns for investors. These tools sought after by market participants as a way to assist
could, however, also present new difculties and them in creating compliance processes that are more
regulatory ramications for businesses to think about. effective, efcient, and risk-based. These RegTech
tools have the power to signicantly alter how
This article desires to dissect this very important tool participants in the securities business carry out their
and innovation in the wake of the upsurge in the compliance responsibilities. But these tools could also
application of Technology in the Financial services cause new problems and legal issues, such as with
sector of our economy and its usefulness in all supervision, vendor management, data security, and
ramication, thus highlighting on the following privacy. Regulators are making efforts to improve their
fundamental areas (i) surveillance and monitoring; (ii) regulatory operations by utilising RegTech tools that
customer identication and anti-money laundering take advantage of cutting-edge technologies by
(AML) compliance; (iii) regulatory intelligence; (iv) applying cloud storage and computing, big data
reporting and risk management; and (v) investor risk analytics, machine learning, and natural language
assessment. With a detail on a list of important benets processing to improve its market surveillance and
and possible regulatory and implementation effects that other regulatory tasks.

The Nigerian Banker, Oct - Dec 2022 27

RegTech as a game changer technologies may give businesses unique chances to
A rising number of software start-ups are using a range improve how risk management and compliance work
of cutting-edge technologies to help nancial services together in their operations.
rms with their efforts to comply with regulatory RegTech Applications in the Securities Industry
requirements. Additionally, a lot of established nancial RegTech tools are being investigated and used by
services companies have started working internally on participants in the securities market to improve
creating different RegTech solutions. The increasing risk regulatory compliance. This section looks at how
that come with innovation is an important reason for RegTech solutions are used in ve key areas: investor
the exploration of the value of Regtech. The majority of risk assessment, regulatory intelligence, client identity
these start-ups were primarily concerned with nancial and AML compliance, reporting and risk management,
services compliance. However, the amounts invested in and surveillance and monitoring. Market participants
the past only cover a small percentage of the expected can run into additional operational difculties and
expenditures on RegTech in the upcoming years. regulatory considerations if RegTech solutions are
employed to improve the efcacy and efciency of
Both legislative changes and technical advancements compliance operations in certain areas. When dealing
have inuenced the recent growth of the RegTech with these issues, broker-dealers may want to think
industry, while a lot of Jurisdictions are in between about the pros and cons of each instrument as well as
taking a decision to regulate and making an outright ban any steps that need to be taken to reduce risks.
on some forms of ntech products. Even though using
technology to help comply with regulations isn't a new Surveillance and monitoring
idea, big changes in both regulations and technology Surveillance and Monitoring is an area where RegTech
over the past few years have made it more important is critically required, the term "surveillance and
for businesses to rethink how compliance duties are monitoring" refers to a wide range of things, such as
done. keeping an eye on the market and how people act, as
well as keeping an eye on traders, registered agents,
In an effort to improve the nancial system and lessen employees, and customers to make sure they are
the likelihood of future crises, a number of additional following the rules.
regulatory requirements for market players both
domestically and internationally were adopted in Market participants have said they are spending a lot of
response to the nancial crisis of 2008. In response, money in this eld, mostly on RegTech products that
businesses have been attempting to keep up with the use cloud computing, big data analytics, or AI/machine
quickly shifting regulatory environment and looking for learning to provide more accurate warnings and
more effective ways to comply with both new and old increase the productivity of compliance and
standards. Because of this, many nancial institutions supervisory staff. Several market players noticed a big
want and need to make the most of their limited drop in false alarms from monitoring systems after they
resources by using technology to create compliance used RegTech solutions.
procedures that are more effective, efcient, and based
on risk. RegTech solutions generally attempt to move from
The advent and widespread use of cutting-edge conventional rule-based systems to a predictive risk-
technologies in recent years have also contributed to based surveillance model that recognises and utilises
the development of RegTech. Today, a number of patterns in data to guide decision-making. To nd
technologies, including articial intelligence (AI), natural suspicious patterns and trends in present data or
language processing, big data and advanced analytics, predict future patterns and trends, for instance,
cloud computing, robotic process automation, computer programmes trained on past data may be
distributed ledger technology, application programme utilized. Also, these computers usually learn by
interfaces (APIs), and biometrics, have the potential to regularly or constantly adding new information
streamline compliance functions. With the use of these through a feedback system that aims to make the next
technologies, businesses may create and employ alerts better.
applications that could improve current compliance
while doing so cost-effectively. Also, using these Certain RegTech solutions may also make it easier to

The Nigerian Banker, Oct - Dec 2022 28

review a larger volume and variety of information, enforcement to recognise and deter suspected money
which could improve how well a rm's regulatory laundering, terrorist funding, and other crimes like
compliance programme functions. Vendors have begun securities fraud and market manipulation. However,
supplying technologies specically designed for there are expenses related to both AML compliance
recording, monitoring, and analysing various forms of and consumer identication.
communications (e.g., audio, video, and digital). These
solutions give businesses the option to survey and Additionally, anecdotal reports from market
analyse all pertinent communications rather than participants imply that conventional approaches to
conducting sample-based assessments of customer identication and AML monitoring may not
communications. Additionally, market participants always have been as successful as intended. As part of
have stated that RegTech tools give them the chance to their search for better solutions, banks are looking into
potentially move away from a traditional lexicon-based RegTech tools.
review focused on particular terms and toward a more
risk-based review using techniques like natural Solutions for client identication and AML have begun
language processing and machine learning to help to be introduced by RegTech startups and a variety of
identify patterns or anomalies. Some technologies also established companies. These solutions are intended
claim to be able to grasp numerous languages, to use technology to create more effective, efcient,
understand tone, understand code language, and and risk-based procedures. Other companies are
understand "emotional phrases" that indicate an intense looking into using distributed ledger technology to ease
response. Many businesses are using more recent the strain of having different nancial institutions
RegTech surveillance tools alongside their more identify or monitor the same consumers
established ones, augmenting these automations with independently. In order to generate a more
human reviews to conrm their efcacy as these comprehensive picture of the consumer, some market
technologies are still in the early phases of development actors are also attempting to blend data collected
and adoption. directly from customers with data from outside
sources. Real-time transaction monitoring is also a
Some RegTech solutions focus on connecting data feature of some RegTech systems.
streams that were previously viewed mostly in isolation
in order to use a more predictive risk-based Some suppliers and nancial institutions are looking at
surveillance strategy. For instance, it has previously the development of central industry utilities as
been challenging to connect certain structured data common solutions for customer identication and
(like trade orders and cancellations, market data, and AML compliance in addition to rm-specic strategies
customer portfolios) with unstructured data (like and tools. These utilities could potentially lessen the
emails, voice recordings, social media proles, and overall compliance load on the sector by utilising
other interactions). On the other hand, RegTech certain RegTech tools (such as those utilising
solutions are being made to help bring together all of distributed ledger technology). If there are any data
these different types of data and then nd and track any protection rules, shared solutions in this area could also
irregularities that need attention. make it easier to combine data from different industry
participants. This would make it easier to link
Compliance with Customer Identication and transactions across organisations and track the cash
AML that goes with them.
Know-your-customer, or KYC, and anti-money
laundering, or AML, programmes are two other areas Regulatory Intelligence
of compliance programmes where the use of RegTech In order to keep a rm's compliance operations up to
products has become more popular. date, regulatory intelligence programmes relate to
areas of compliance that concentrate on the
For the nancial markets to operate legally and in an identication and interpretation of changes to
organised fashion, customer identication and AML- applicable laws and regulations, frequently across
related rules and regulations are essential. They make it different countries consequently, market participants
possible for market players, regulators, and law

The Nigerian Banker, Oct - Dec 2022 29

have been looking into how RegTech solutions could These RegTech tools aim to use technology
help speed up this process. advancements (such as data aggregation and machine
learning) in conjunction with behavioural sciences to
RegTech tools that support regulatory intelligence in assess an investor's risk appetite and tolerance in a
their most basic form typically offer a user-friendly more accurate way than current tools. For instance,
catalogue of regulatory requirements that is updated in some systems gauge a user's risk appetite and
real-time with timely reminders of impending changes tolerance based on how well they do in "games" meant
and new enforcement actions that may alert rms to to reveal how they respond to shifts in the market and
review applicable supervision and compliance portfolio performance. In order to create a more
operations. The goal of these RegTech tools is to at least complete image of an investor, this data might be
partially automate what would otherwise be a very combined with their expressed preferences. Some
time-consuming and labor-intensive way for businesses RegTech platforms also keep an eye on investor
to keep track of important changes to regulations portfolios in the face of shifting market conditions and
before deciding and making the necessary changes to generate suggestions for how to better match the
their compliance processes. portfolio to the investor's risk prole.

Additionally, some RegTech products provide a

platform where it is essential to check for compliance RegTech's Effects on the Securities Industry
RegTech may have a number of advantages but may
with applicable regulations before taking an action,
also bring forth new difculties. In this section, we
attempting to integrate compliance functions into a
briey talk about the possible benets of RegTech
rm's everyday operations. In derivatives trading, for
innovations. We then talk about some possible
example, companies and their traders can use RegTech
problems and important regulatory effects that market
solutions to make sure that, before a trade is made, it
participants should think about when putting new
complies with all relevant rules and regulations, such as
technologies to use in their compliance programs.
those about clearing and reporting.
Impact on the Securities Industry
Firms may benet from improved risk management,
Reporting and Risk Management
increased effectiveness and efciency, and improved
Another area of compliance where businesses are industry collaboration thanks to the use of regtech
using RegTech solutions is reporting and risk products and services. This might therefore help
management plans. Solutions in this area make use of businesses better encourage compliance, which could
technology to create tools that facilitate or automate be advantageous to investors and the larger nancial
operations related to regulatory reporting, risk data market.
aggregation, and the production and monitoring of risk Risk Management
metrics (both for enterprise risk management and
operational risk management). A RegTech tool might be RegTech solutions could improve a company's capacity
used, for instance, to gather and analyse data on capital to take a proactive, risk-based approach to regulatory
and liquidity for use in internal models or to report to compliance. For instance, RegTech technologies
regulators in order to help with risk data aggregation or (based on AI and big data analytics) are being used to
regulatory reporting. proactively identify possible hazards by providing alerts
that assist in the establishment of more forward-
Investor Risk Assessment looking compliance strategies as opposed to nding
Firms must get information from their clients and use infractions after they occur. RegTech solutions are also
reasonable policies and procedures to ascertain the being used to make it easier for businesses to do
investor's risk appetite and tolerance, subject to any enterprise-level reviews by letting them look at data
periodic updates or modications, in order to give from all over the organization, reducing potential
clients the right kind of investment advice. One area of compliance gaps and breaking down silos.
RegTech that is still pretty new but growing quickly is
the creation of tools to help investors evaluate risk. Automatization, efciency, and effectiveness
One of the most popular applications of RegTech,

The Nigerian Banker, Oct - Dec 2022 30

increased automation of compliance operations, has a data patterns and evolve over time. Professionals in
number of potential advantages. By using robotic compliance and business may lack the technical
process automation (RPA), for instance, businesses may knowledge necessary to comprehend these
be able to reduce the need for repetitive tasks (such as algorithms' workings in great depth. It can be difcult to
gathering data and analysing information across examine the methodology or logic that an AI algorithm
systems) and thereby speed up processes, reduce uses to produce a certain output or decision. The
errors, and free up resources for higher-level tasks like potential for algorithmic techniques to negatively affect
reviewing alerts and developing responses. market and business stability has developed along with
the rise in their use. Below are a few potential
Additionally, some RegTech solutions can be integrated governance and supervision areas that nancial
into a company's operational and oversight processes, services rms may wish to think about while
making regulation compliance an integral part of the implementing RegTech solutions.
business process (e.g., tools that review for compliance
with certain specic rules before trades are submitted Building a cross-functional structure for technology
for execution). This allows you to prevent non- governance The creation, testing, and use of RegTech
compliant behaviours from occurring in the rst place, tools may benet from the involvement of a
rather than discovering them during a post-event multidisciplinary team. Possible problems can also be
compliance check. reduced by testing different scenarios and tool outputs
with the help of a group of people from different
Utilizing specic RegTech tools may also help decrease departments.
the number of false warnings, freeing up staff time to
concentrate on alerts that require escalation. A condensed overview of RegTech tools. Non-
In their end-user interface, many RegTech products technical personnel may be better able to judge results
provide intuitive tools for end users to extrapolate that do not match expectations by maintaining a simple
various scenarios, as well as synthesised visualisations of summary describing the underlying algorithms and
sophisticated statistics. These qualities make it simple related strategies. This will help them comprehend the
to train staff members on how to utilise these tools and intended roles of the tools and algorithms.
streamline analysis for compliance functions.
Risk management for data quality. For many RegTech
Considerations for Implementation and products, especially those that use AI to produce
Regulation desired results, data integrity and control are of utmost
Broker-dealers should be aware of the potential importance. To help ensure the correctness,
difculties that the adoption of these tools may bring completeness, and consistency of the data used to
and their regulatory consequences as they investigate support the RegTech systems, it is essential to develop
RegTech tools and services to aid in their regulatory an effective data quality risk management program.
compliance efforts. Some of the most important
consequences for nancial services rms. A procedure for locating and xing mistakes or issues.
Supervisory Control Systems Firms may gain by having suitable policies and
procedures in place to recognize, address, and reduce
Regulations require businesses to have acceptable material risks that can materialise in the event that
supervisory policies and processes relating to mistakes or malfunctions occur when using a RegTech
supervisory control systems. This means setting up the tool. This can entail setting up fall back procedures that
right processes and governance frameworks for can be quickly used if the RegTech tool fails.
RegTech technologies, like keeping an eye on tools and
systems that use AI. Personnel training. The rm may be able to make
better use of the RegTech tools it has adopted if
RegTech solutions make use of highly complicated and compliance, management, and operational staff are
advanced AI algorithms that are intended to learn from given the right training.

The Nigerian Banker, Oct - Dec 2022 31

Client Data Protection and sophisticated cryptography, some RegTech
When it comes to surveillance and monitoring (such as applications are being created particularly to solve
recording customer communications with registered security-related threats. But when different ofine
representatives), customer identication and AML tasks are moved into a more automated computer-
compliance (such as sharing customer on boarding data based system, using RegTech more and integrating it
with a vendor), or investor risk assessment tools, some
into compliance and regulatory systems could also
emerging RegTech tools and services involve the
create new security risks.
collection, analysis, and sharing of customer-related
information. While these tools and data-collection
RegTech tools, for instance, might constantly link to
techniques may improve a company's capacity to use
technology and carry out compliance tasks effectively, and pull data from various internal and external
they could also pose potential hazards to the privacy of sources, which might open up new possibilities for
consumer data, especially when that data is shared with security risks. Working with numerous new vendors
a third-party vendor. When investigating such RegTech and granting them access to a company's systems might
apps, Firms should take customer data privacy laws into similarly lead to the creation of new sources of risk.
account. Firms should consider security risk management while
evaluating and implementing RegTech products.
Firms may need to adjust their policies and procedures Companies should pay strict attention to technology
relating to consumer data privacy to reect such governance, system change management, risk
changes as they implement RegTech technologies that assessments, technical controls, incident response,
include changes in how they collect, store, analyse, and vendor management, data loss prevention, and
share sensitive customer data. In light of this, the employee training
following are some things businesses may want to think
about: Additional Regulatory and Implementation
Issues Interoperability
Whether the necessary consent of consumers has been Companies may want to think about whether new
obtained for the acquisition of new or additional RegTech tools, especially vendor solutions, are
information, the use of such information for internal compatible with other operational and compliance
analysis and monitoring, and the sharing of any
systems in the company. This can help reduce the
customer data with third-party suppliers, such as
chance of system errors.
recording audio or video communications

Talent and training

Whether there are appropriate policies and procedures
Companies should think about whether they have the
regarding the sharing of such data with vendors,
including how and what level of access is provided to right personnel, roles, and training for processes that
vendors; any restrictions on vendors sharing data with could change as a result of implementing RegTech
other third parties; and any restrictions on aggregating solutions. The focus of nancial institutions is on
customer information with data from other vendor updating skill sets,
clients; Whether appropriate training is provided for
pertinent individuals and departments who collect or
have access to customer information

Security dangers
The nancial services sector's top topic of worry is still
cybersecurity and data-related issues. By utilising
cutting-edge technologies like block chain, biometrics,

The Nigerian Banker, Oct - Dec 2022 32

The Nigerian Banker, Oct - Dec 2022 33
Ethics and Professionalism in the Nigerian
Banking Sector:
A Review of Decided Cases

‘Uju M. Ogubunka, Ph.D, FCIB

1.0 Introduction: the frequency at which each type of case (matter)

The Bankers Committee in Nigeria, set up its Sub- featured, the parties that were involved in the cases
Committee on Ethics and Professionalism in 2001 to and the number of cases that were won and lost by
address or intervene on cases/petitions relating to each of the involved parties. A higher level of
unethical and unprofessional happenings in the s t a k e h o l d e r- a w a r e n e s s , u n d e r s t a n d i n g a n d
country's banking sector. The Sub-Committee more or consciousness is expected to emerge, leading to
less serves as an Ombudsman in the banking sector. stakeholders' learning of appropriate lessons,
Over the years, it has intervened in several complaints especially with regard to the enormity or otherwise of
and petitions by stakeholders. The interventions unethical and unprofessional practices in the sector.
involved different stakeholders and cut across a Such a learning will hopefully awaken Stakeholders to
number of issues in banking. ensure that ethical and professional banking thrive in
Nigeria, in the best interest of all.
The complaints/petitions that the Sub-Committee took
decisions on have been published in two volumes by the It is important to state and indeed, emphasize that, no
umbrella Professional Body of Bankers in Nigeria, The attempt has been made in this paper to delve into the
Chartered Institute of Bankers of Nigeria (CIBN). The details, merits or demerits of any case in the two
rst edition titled “Ethics and Professionalism in the books. However, we opine that the Learning Points
Nigerian Banking Sector: A Review of Decided Cases” highlighted on Chapters 17 and 16 in 1st and 2nd
was published in 2009 while the second edition titled editions of the book, respectively should be given
“Ethics and Professionalism in the Nigerian Banking serious attention by all stakeholders in the Nigerian
Sector: Decided Cases” was published in 2016. banking industry.

This paper seeks to aggregate and analyse the dispersed 2.0 Presentation Outline
information/data contained in the two books with a From Subsection 2.1 to 2.5, are presented details in
view to revealing the salient but hidden Nigerian respect of: the number of cases decided; the number
banking sector's global issues in relation to: the number and different types/categories of cases decided;
of unethical and unprofessional cases that were decided frequency occurrence of each type of case; parties to
within a specic time frame (2001-2016) by the Sub- the cases decided and their contributions; the number
Committee, the number and different types or and types of cases won/lost by the parties. In Sections
categories of complaints/petitions that were handled, 3, 4, 5 and 6 are presented the ndings, implications,

The Nigerian Banker, Oct - Dec 2022 34

recommendations and conclusions, respectively. 2.2 Number and Types/Categories of Cases
(Complaints/Petitions)
2.1 Number of Cases Decided by the Sub- The type of cases decided by the Sub-Committee
Committee arose from different areas/issues in banking business.
As shown in Table 1, the number of cases decided was As shown in Table 1, they were categorized into a
38 and 75 in the rst and second editions, respectively. maximum of sixteen (16) different types including:
Thus, the total number was 113. Noticeable from the Negotiable Instruments/Conversions,
foregoing is the fact that the number of cases decided in Guarantees/Bonds, Unprofessional Conduct,
the second edition out-numbered that of the rst Forgeries, Letters of Credit and Debt Assignment. In
edition by 37 or 97.4%, an indication that the Sub- the rst edition, 15 categories were indicated while the
committee must have worked harder to resolve the second edition showed only 14. The categories/types
cases before it. It is observed that the Sub-Committee in the two editions are about the same except that,
made this achievement in a period of sixteen (16) years while the rst edition exclusively included “Clearing
of its life, having been set up in 2001. This means that on Cheques” and “Dishonouring of Bank Drafts”, the
average, the Sub-Committee decided about seven (7) second edition included “Breach of Contracts”
cases per annum. exclusively. The total number of all types of cases that
arose was 113 as earlier stated in Sub-section 1.1 and
shown in Table 1.
Table 1: NUMBER OF CASES DECIDED AND
TYPES/CATEGORIES OF THE CASES 2.3 Frequency of Each Type of Case
As evident in Table 1, the maximum number of cases
S/N TYPES/CATEGORIES OF 1ST EDITION 2NDEDITION TOTAL
from any type/category was 38 (Negotiable
CASES
No of % of No of % of No of % of
Instruments/Conversion) while the minimum number
Cases
Decided
Total Cases Total Cases
Decided
Total
was one (1) in each of two case categories – “Clearing
Decided
Cheques” and “Dishonouring of Bank Drafts”.
1. Negotiable Instruments/Conversion 14 36.8 24 32 38 33.6

2. Guarantees / Bonds 4 10.5 9 12 13 11.5

To make the picture clearer, the type of case that had
3. Unprofessional Conduct 3 7.9 3 4 6 5.3
the highest number was “Negotiable
4. Forgery 1 2.6 6 8 7 6.2 Instruments/Conversion” with a frequency of 38 or
5. Armed Robbery 1 2.6 1 1.3 2 1.8 33.6% of the total, 113 cases. The second frequency
6. Irregular /Excess Bank Charges 5 13.2 20 26.7 25 22.1 position went to “Irregular/Excess Bank Charges” that
7. Internal Control Breaches 1 2.6 1 1.3 2 1.8 recorded 25 cases or 22.1% of the total number of
8. Stocks / Shares 1 2.6 1 1.3 2 1.8
cases decided, 113. The third position in frequency of
9. Letters of Credit 1 2.6 2 2.7 3 2.7
occurrence was “Guarantees/Bonds” with 13 types of
cases or 11.5% of the total. The least number of type
10. Clearing Cheques 1 2.6 - - 1 0.9
of cases arose from the categories described as
11. Dishonouring of Bank Draft 1 2.6 - - 1 0.9
“Clearing Cheques” and “Dishonouring of Bank Draft”
12. Collateral Security 1 2.6 2 2.7 3 2.7
that recorded one case each or about 0.9% of the
13. Debt Assignment 1 2.6 1 1.3 2 1.8 total. Consequently, most types of cases that plagued
14. Settlement / Clearing Agreement 1. 2.6 1 1.3 2 1.8 banks were in the categories of Negotiable
15. Fraudulent Conversion 2 5.3 1 1.3 3 2.7 instruments/Conversion, Excess bank charges and
16. Breaches of Contracts - - 3 4.0 3 2.7 Guarantees/Bonds. Indeed, these three categories
Total 38 100 75 100 113 100
jointly had 76 or 67.3% of the 113 decided cases,
leaving only 37 cases or 32.7% to the other 13
categories from where cases emanated.
Source: 1st and 2nd Editions: Ethics and Professionalism in the
Nigerian Banking Sector: A Review of Decided Cases/Decided The implication is that banks need to focus on these
Cases, 2009 & 2016, respectively. case categories to right whatever might have been the
wrongs, in order to avoid or minimize being petitioned

The Nigerian Banker, Oct - Dec 2022 35

against by their customers. The greater need for this Table 2: IN THE 1ST EDITION - NUMBER OF BANK-BANK
actually lies on the fact that, of the 58 customer-bank AND CUSTOMER-BANK CASES AND NUMBER
cases arising from the three categories, banks lost 51 or OF FAVOURABLE DECISIONS PER PARTY
87.9% of the cases to their customers, winning only 7
S/N TYPES/CATEGORIES OF Total No. No. of No. of No. of No. of
or 12.1% of the total. It is therefore, in banks' best CASES of Cases Bank – Customer Decisions in Decisions in
Decided Bank Bank Favour of Favour of
interest not to allow infractions in the three case Cases Cases Banks Customers

categories.
1. Negotiable Instruments/ 14 4 10 - 10
Conversion

2.4 Parties to the Cases and Their Contributions 2. Guarantees/Bonds 4 3 1 - 1

Evidence from the two editions of the book under 3. Unprofessional Conduct 3 - 3 - 3

review indicates that, the Parties to the “decided cases” 4. Forgery 1 - 1 - 1

5. Armed Robbery 1 - 1 - 1
by the Sub-Committee on Ethics and Professionalism
6. Irregular/Excess Bank Charges 5 - 5 - 5
were banks and their customers. The affected
7. Internal Control Breaches 1 - 1 - 1
customers cut across individuals and organisations of 8. Stock / Shares 1 - 1 - 1
different types, for instance limited and unlimited 9. Letters of Credit 1 - 1 - 1
companies, although their names were not reported. 10. Clearing Cheques 1 - 1 1 -

11. Dishonouring of Bank Draft 1 1 - - -

In some cases, banks petitioned against themselves 12. Collateral Security 1 - 1 1 -

while in others either customers or banks petitioned 13. Debt Assignment 1 1 - - -

against each other. While evidence from Table 2 shows 14. Settlement / Clearing Agreement 1 1 - - -

that of the 38 cases decided in the rst edition of the 15. Fraudulent Conversion 2 1 1 - 1

publication, 11 (28.9%) were between banks and 27 Total 38 11 27 2 25

% of Total 100 28.9 71.1 - -

(71.1%) were between banks and their customers, in
% of Total - - 100 7.4 92.6
Table 3 is shown that of the 75 decided cases in the
second edition, 19 (25.3%) were between banks while
56 (74.7%) were between banks and their customers. Source: 1st Edition of Ethics and Professionalism in the Nigerian
Banking Sector: A Review of Decided Cases (2009).
Consequently, bank against bank cases totaled 30 or
26.5% of all the 113 decided cases. On the other hand,
customer-bank cases totaled 83 or 73.5% of the 113 2.5 Number and Types of Cases Won/Lost by
decided cases in the two editions. These show that Parties (Winners and Losers).
customer-bank cases contributed more to the cases Under this title, we only considered cases between
handled by the Sub-Committee than bank-bank cases. customers and banks.
It evidences also that the Sub-committee decided more
cases involving banks and their customers than those In the rst edition of the publication, 38 cases were
between one bank against another. It suggests that decided. Out of these, 27 or 71.1% were between
more petitions/complaints might have been received banks and their customers. As shown in Table 2, of the
27 cases, customers were successful winners in 25 or
from banks' customers by the decision makers.
92.6% while banks succeeded in only 2 or 7.4%.
It is necessary to observe that the presence of cases
In the second edition, there were 75 cases with 56 or
among banks in the publications signies that even
74.7% of them being between banks and customers.
banks could not, on their own, resolve issues that
Of the 56 cases, 46 or 82.1% were decided in favour of
affected them without the intervention of a third party. customers and 10 or 17.9% in favour of banks (see
It however, indicates the condence banks repose in Table 3). Again, the customers were winners of a
the ability and capacity of the Sub-Committee to signicant proportion of the cases than banks.
resolve their cases amicably as otherwise they would
have taken the cases to the law courts. On aggregate therefore, of the 113 cases that were
Customer – Bank Cases

The Nigerian Banker, Oct - Dec 2022 36

decided, 83 or 73.5% were between customers and Table 4: CUSTOMER–BANK CASES:
banks while 30 (26.5%) were among banks. Customers WINNERS AND LOSERS
were winners in 71 or 85.5% of the 83 cases while S/N TYPES/CATEGORIES OF Total No. Total No. No. of No. of
banks took the remaining 12 or 14.5%. Thus, bank CASES of Cases
Decided
of
Customer
Decisions
in Favour
Decisions in
Favour of
customers were the indisputable overall winners. Bank Cases of Banks Customers
1. Negotiable Instruments/ Conversion 38 29 2 27

It is noteworthy from Table 4 that, customers won all 2. Guarantees /Bonds 13 4 2 2

the cases (16) that were decided in respect of: 3. Unprofessional Conduct 6 6 - 6

Unprofessional Conducts (6), Forgery (2), Armed 4. Forgery 7 2 - 2

Robbery (2), Internal Control Breaches (2), 5. Armed Robbery 2 2 - 2

Stocks/Shares (2), and Breaches of Contracts (2). Also 6. Irregular/Excess Bank Charges 25 25 3 22

worth noting is that, of all the 25 cases on Excess Bank 7. Internal Control Breaches 2 2 - 2

Charges, customers won 22 or 88%. Similarly, of the 29 8. Stocks / Shares 2 2 - 2

cases under Negotiable Instruments/Conversions, 9. Letters of Credit 3 3 1 2

customers won 27 or 93.1%. In other words, overall, 10. Clearing Cheques 1 1 1 -

banks lost to their customers 71 (85.5%) out of the 83 11. Dishonouring of Bank Draft 1 - - -
cases the Sub-Committee decided between banks and 12. Collateral Security 3 3 2 1
their customers. Without any doubt, banks' customers 13. Debt Assignment 2 - - -
were the overall winners, with a very wide margin,
14. Settlement / Clearing Agreements 2 - - -
against banks. 15. Fraudulent Conversion 3 2 1 1

16. Breaches of Contracts 3 2 - 2

Total 113 83 12 71
Table 3: IN THE 2ND EDITION - NUMBER OF
Percentage (%) of Total 100 14.5 85.5
BANK-BANK AND CUSTOMER-BANK CASES AND
NUMBER OF FAVOURABLE DECISIONS PER PARTY
Source: Extracted from Tables 1, 2 and 3.

S/N TYPES/CATEGORIES Total No. of No. of No. of No. of

OF CASES No. of Bank – Customer Decisions Decisions in
Cases Bank Bank Cases in Favour Favour of
Decided Cases of Banks Customers 3.0 Summary of Findings
1. Negotiable Instruments/ 24 5 19 2 17
Conversion
The following ndings have been made from the
2. Guarantees/ Bonds 9 6 3 2 1 foregoing study:
3. Unprofessional Conduct 3 - 3 - 3 a). On the whole, 113 decided cases were
4. Forgery 6 5 1 - 1 documented in the two editions with 38 or
5. Armed Robbery 1 - 1 - 1 33.6% and 75 or 66.4% in the 1st and 2nd
6. Irregular/Excess
Charges
Bank 20 - 20 3 17 editions, respectively. On average seven (7)
7. Internal Control Breaches 1 - 1 - 1
cases were decided per annum.
8. Stocks / Shares 1 - 1 - 1 b). The total number of decided cases among
9. Letters of Credit 2 - 2 1 1 banks, that is, bank-bank cases, was 30 (11 and
10. Collateral Security 2 - 2 1 1 19 in the 1st and 2nd editions, respectively)
11. Debt Assignment 1 1 - - - which accounts for about 26.5% of the 113
12. Settlement / Clearing 1 1 - - - overall decided cases.
Agreement

13. Fraudulent Conversion 1 - 1 1 -

c). The number of cases decided between
14. Breaches of Contracts 3 1 2 - 2
customers and banks was 83 (27 and 56 in the
Total 75 19 56 10 46 1st and 2nd editions, respectively). That
accounts for 73.5% of all the 113 decided cases.
% of Total 100 25.3 74.7 - -
In other words, there were about 2.8 times
% of Total - - 100 17.9 82.1
more decided cases relating to banker-
customer than to Banker-Banker.
Source: 2nd Edition: Ethics and professionalism in the Nigerian
d). The type of issues, that is, complaints/petitions
Banking Sector: Decided Cases (2016).
that were reported to and decision taken on by

The Nigerian Banker, Oct - Dec 2022 37

 the Sub-Committee on Ethics and Contracts (2).
Professionalism of the Bankers Committee j). Banks, on the other hand, won the lone case (1)
(Nigeria), were in sixteen (16) categories. In between them and a customer in respect of
summary, the issues cut across: Negotiable Clearing Cheques.
Instruments/Conversion, Guarantees/Bonds,
Unprofessional Conduct, Forgery, Armed 4.0 Implications
Robbery, Irregular/Excess Bank Charges, The implications from the outcome of this study are
Internal Control Breaches, Stocks/Shares, not just for the banks but also their Regulators and
Letters of Credit, Clearing Cheques, Supervisors. They include the following:
Dishonouring of Bank Draft, Collateral Security,
Debt Assignment, Settlement/Clearing First, either the banks did not understand what they
Agreement, Fraudulent Conversion and were doing or they deliberately mishandled some of
Breaches of Contracts. their customers' transactions perhaps, believing that
e). Among the 16 types of cases, Negotiable the customers would not discover. Fortunately, they
Instruments/Conversion recorded the highest have been proved wrong by the customers.
number of decisions with 38 or 33.6% of the
total 113 number of cases. It was followed by
Second, there is the need for proper capacity building
Irregular/Excess Bank Charges with 25 or 22.1%
in the banks. This is very obvious with regard to the
of the total. The third was Guarantees/Bonds
handling of such critical and important operational
that recorded 13 decided cases or 11.5% of the
instruments/activities as Negotiable Instruments,
total 113. However, coming from the rare with
Charges by banks, and Contracts.
just one decided case each were Clearing
Cheques and Dishonouring of Bank Draft,
respectively. Each of them accounted for just Third, Supervisors of banks did not seem to have
0.9% of the total. closely and constantly monitored what banks were
f). The Parties that were involved in cases decided doing. There is, for instance, no good reason that can
by the Sub-Committee were banks and bank be adduced for banks' excess charges against their
customers. The type of customers included customers when there are computers and other
corporate organisations and individuals. In some electronic/mathematical equipment that have the
cases, banks petitioned against one another or capacity to generate correct or error-free results in the
their customers. In others, customers petitioned computation of gures, if only the inputs are correct
against their banks. The names of all the parties and no manipulations are induced. The case on excess
were not reported. bank charges is one practice banks' Supervisors and
g). Among the 83 cases between banks and their Regulators can penalise banks to prevent or stop such
customers, banks lost 71 or 85.5% while unacceptable and unprofessional practice.
customers only lost 12 or 14.5%. Thus,
customers won about 5.9 times more than the Fourth, bank customers were not just aware of
banks. operations/transactions in their accounts but could
h). In the three categories that cases were most even school/educate bank ofcials on how not to
decided, that is: Negotiable handle such transactions. Thus, either the banks brace
Instruments/Conversion, Irregular/Excess Bank up on their responsibilities or they will continue to
Charges, and Guarantees/Bonds, customers suffer the indignity of losing cases to their aggrieved
recorded favourable decisions in 27 or 93.1% of customers.
29, 22 or 88% of 25 and 2 or 50% of 4 cases,
respectively. Finally, in whatever way the outcomes of this study may
i). Banks lost all the 16 cases involving them and be seen or perceived, the imperative is that they
their customers in the following six (6) neither support the building of consumer/customer
categories: Unprofessional Conduct (6), Forgery condence in the banking sector nor the nancial
(2), Armed Robbery (2), Internal Control inclusiveness being propagated and pursued by the
Breaches (2), Stock/Shares (2) and Breaches of

The Nigerian Banker, Oct - Dec 2022 38

Central Bank of Nigeria (CBN). Consequently, Committee had to intervene in as many as 30
something urgent and drastic but redeeming, should be bank-bank cases or 26.5% of the 113 decided
done. cases does not indicate that banks have
developed the capacity to resolve their own
5.0 Recommendations disagreements.
i). Banks need to seriously build human capacity vi). There is the challenge for Regulators and
via education and training to prevent the Supervisors of banks to urgently nd
reoccurrence of the weaknesses that permanent solutions to the penchant of banks
prompted customers to petition and even win imposing excess/irregular charges on their
cases against them. Specically, banks' customers which is a major source of bad
employees need to understand how to handle reputation for the banking industry.
transactions on such important issues as vii). The Bankers Committee and the Chartered
Negotiable Instruments. They should, for Institute of Bankers of Nigeria (CIBN) should
example, study the British Bills of Exchange Act set up a team of banking professionals to draw
1882 and Cheques Act 1957 as well as Nigeria's up appropriate, practical and standard Case
B i l l s o f E x c h a n g e A c t C A P. B 8 a n d Studies from the activities of the Sub-
Dishonoured Cheques Offences Act CAP. D Committee on Ethics and Professionalism for
11, The Laws of the Federation of Nigeria, the education and training of the present and
2004; and Guide to Bank Charges/Guide to upcoming generation of banks' management
Charges by Banks, issued by the Central Bank and employees as well as other interested
of Nigeria. persons.
ii). Banks should, through services to their viii). The Bankers Committee and CIBN should set
customers and the general public, support the up an Annual Merit Award to acknowledge
Central Bank of Nigeria's Financial Inclusion and celebrate banks that operate without
Programme and the building of condence in irregular/excess charges on their customers'
the banking and nance sector. Acts that tend accounts.
otherwise should be stopped if the country ix). The Sub-Committee on Ethics and
must make appreciable progress towards Professionalism should look into the possibility
attaining full nancial inclusion and condence of reclassication of the cases/petitions as
in the sector. some of what exists currently can be re-
iii). The six (6) categories complaints in which categorised. For instance, Bank Drafts and
banks lost all the 16 cases against them need to Cheques can be part of Negotiable
be closely and carefully studied with a view to Instruments while Fraudulent
discovering the weaknesses that made that Conversions/Conversions can form a separate
possible (i.e. what prompted the losses) and category.
instituting preventive measures. x). The Sub-Committee should consider stating in
iv). Banks should, as much as possible, nip in the the reports, the names of parties (banks and
bud issues that may result to disagreements customers) whose cases were resolved by it.
(among themselves and/or between them and This may bring some element of name and
their customers) that will necessitate the shame, especially with the banks.
intervention or determination of a third party xi) The Sub-Committee should also consider
say, the law courts or the Sub-Committee on reporting the length of time (from receipt to
Ethics and Professionalism. That way, they will decision) each case took before nal decision
be giving llip to the greatly desired consumers' was reached. That may be useful in comparing
condence in the banking sector and nancial which, of the regular courts of law and the
inclusion in the country. Ombudsman, is faster in concluding cases.
v). Banks should operate as sister institutions and xii). Management and other employees of banks
develop the capacity to resolve disagreements need to abide by the banking industry's Code
between them without the intervention of a of Ethics and Professionalism as well as Code
third party. A situation where the Sub- of Conduct to be able to overcome challenges

The Nigerian Banker, Oct - Dec 2022 39

 relating to unethical and unprofessional In the second instance, it provided opportunity for
conducts and practices. banks to know the extent their customers were
xiii). Banks' management and other employees who displeased with them, the basis for such displeasures
infringe customers' rights or inict pains on and the eventual outcome so that collective and
them through spurious or unjustied entries individual efforts can be made to right any wrongs with
into their accounts should be shed out and a view to building and sustaining customers' condence
adequate punishment ranging from say, six (6) in the banking system.
months suspension without pay to summary
dismissal meted on them, depending on the That out of the 83 cases between banks and their
gravity of their offences. customers, the customers won 71 or about 85.5% of
xiv). Banks should take time off to inquire into the the cases, should be a pointer that much is required of
effectiveness of their Inspection and banks to plug the knowledge and practice gaps in their
Compliance Departments, respectively with a organizations. In essence therefore, activities of the
view to plugging identied areas that make Sub-Committee also served as a veritable learning
banks susceptible to petitions by other banks experience for all the constituent members of the
and customers, that any or both departments Bankers Committee and of course, consumers of
would have prevented, if only their functions banking services.
were properly and effectively performed.
xv). Banks' customers and indeed, all consumers of It must also be noted that it is because the customers
banking services should be encouraged to take had condence in the Sub-Committee that they led
up with banks relevant issues they are not their cases there rather than in the courts of law. In
satised with. If answers they receive are not whatever manner such condence was initiated, built
satisfactory, they should escalate the case to and developed, it must never be toyed with for it to be
the Sub-Committee on Ethics and sustained. If anything should make customers'
Professionalism of the Bankers Committee for condence in the Sub-Committee to wane, it should
determination. This way, Nigeria's banking be expected that the customers may have no choice
sector may receive the push it requires to than to resort to the courts, which will not be in the
upscale its professional performance in the best interest of the parties, especially as the speed at
interest of the industry's development, growth which cases are going to be resolved will become
and stability. longer than is necessary with consequent higher cost
implications in terms of money and time.
6.0 Conclusions
It is a welcome development that the Bankers Finally, the Sub-Committee has now been in
Committee set up its Sub-Committee on Ethics and operations for over 19 years since its establishment in
Professionalism for the purposes of intervening and 2001. It should therefore, not be out of place to expect
resolving unethical and unprofessional practices among that the framework under which it operates is due to
banks and between banks and their customers. It serves be thoroughly re-assessed and reviewed to ensure that
as an intra-industry dispute resolution mechanism it even becomes more serviceable to the banking
which is very noble. industry and the entire Nigerian economy.

In one sphere, activities of the Sub-Committee have

reduced the number of cases in this regard being led at
the regular courts of law that are usually associated with
case congestions and very lengthy time duration before
nal determination/resolution. If the services of the
Sub-Committee had not been available, the 113
reported settled cases in the two volumes of the
overviewed book would have been led in the courts to
further congest them.

The Nigerian Banker, Oct - Dec 2022 40

Intelligence-Gathering and the Challenges
of Insecurity in Nigeria
CP Sylvester A. Alabi, FDC

INTRODUCTION: 'Intelligence- Gathering and Challenges of

It is my pleasure to be in your midst this morning, as a Insecurity in Nigeria'. This topic cannot be timelier
Guest of Honour, and to present a paper on a topic than now, as traditional reactive policing models,
critical to resolving the current and prevailing insecurity all over the world have proved inefcient in
challenges in Nigeria. There is no doubt that the tackling emerging and emergent internal security
contemporary Nigeria, from east to west, north to threats in the world. Hence, the need for a
south, is plagued with myriad of internal security paradigm shift in policing approaches that will
threats, which call to question our policing strategies embrace and incorporate modern technologies
and law enforcement infrastructure as a police force. and tools in crime control and investigations
Undoubtedly, criminality in Nigeria has not only becomes imperative. Globally, the impetus for
become more organised, but highly diffusive and employment of intelligence in policing is the
sophisticated; and no meaningful development and seemingly failure of the police in addressing the
economic growth can take place without the adequacy systemic sources of crimes and crime patterns in
of domestic peace, law and order in the society. This, the society, which have been hitherto responsive
therefore, underscores the frequency of discourses and and opportunistic. The need, therefore, for a
regular conversations, both in formal and informal fora, proactive approach in policing, targeting the
interrogating the seemingly intractable nature of criminal, not the crime, and making much more
insecurity challenges in our present day, Nigeria, with and more better use of intelligence becomes
the aim of devising and proffering pragmatic and highly desirable in our contemporary society
possible ways of resolving and containing the threats. where crimes have become more mobile and
complex. It is a known fact that the most potent
I am aware that this retreat is no exception, and quite threat to internal security of any country is crime.
commendably so, for it seeks for ways of improving the A report of the United Nations Ofce on Drug and
security situation in the country, as that remains Crime titled; “Crime and Development in Africa”
indispensably critical for economic prosperity in released in June, 2005, brings to the fore how
Nigeria. No wonder, I have been requested to speak on crime undermines economic development.

Paper delivered at the 15th Annual Retreat for the Chief Security Officers of Banks and
Other Financial Institutions in Nigeria held in October, 2022

The Nigerian Banker, Oct - Dec 2022 41

 simplest and clearest of these is “information plus
The report maintained that; analysis equals intelligence.” The formula above
(a) Crime erodes Africa's social and human capital; claries the distinction between collected information
(b) Crime drives business away from Africa, and produced intelligence. It notes that without
(c) Crime undermines the ability of the state to analysis, there is no intelligence. Intelligence is not what
promote development: is collected; it is what is produced after collected data is
evaluated and analysed. Simply put, it is a processed
In the same vein, World Bank report argues, that and synthesized information.
“Crime… increases the costs of business, whether
through the direct loss of goods or the costs of taking “Criminal intelligence” is simply any information with
precautions such as hiring security guards, building additional value that can be employed by law
fences or installing alarm systems. In the extreme, enforcement agencies in analysing and dealing with
foreign rms will decline to invest, and domestic ones crime. Sophistication in the use of police information
will ee the country for a more peaceful locale”. and intelligence has been steadily increasing over the
Policing, therefore, is the fundamental process through last half-century due to organised nature and
which public safety, security and public order could be complexities of crime in our contemporary world.
ensured at all times. Through the process of policing Intelligence techniques and methodologies have,
and law enforcement, the police preserves, protects therefore, been developed to identify crime threats or
and promotes social peace, safety and stability, thereby to prole existing crimes or crime gures, which will
ensuring liberty, economic development and aid in solving crimes in the society. The advent of
prosperity. While drawing on my over three decades criminal intelligence is directly linked to the
experience in policing and law enforcement, I will do transformation of individual crimes into organized and
my best to simplify this topic to the understanding of all, sophisticated criminal groups of nefarious enterprise.
and it is my hope that expositions will meet your
practical expectations and intellectual curiosity. The effective use of intelligence is crucial to the law
enforcement's ability to combat criminal groups and
de-escalate crime in the society. Intelligence provides
2. INTELLIGENCE, AND CRIMINAL the police with the required knowledge for effective
INTELLIGENCE IN POLICING: management of its resources towards the efcient
Intelligence: The word, intelligence, has been dened discharge of its statutory functions. With appropriate
differently. To some, it is “information designed for tasking, the products of intelligence analysis can assist
action”, or “assessed information”. To others, it is in developing strategic plans to tackle emerging
information transformed into intelligence through the internal security threats and prepare for future
analytical process; or “information which is signicant, anticipated ones. Criminal intelligence empowers the
or potentially signicant, for an enquiry or a potential police to establish a pro-active response to crime, and
enquiry”. The common theme, however, is that enables them to identify and understand criminal
intelligence is a special type of information with groups operating in their areas. Once criminal groups
additional value that can be recognised or assigned are identied and their habits known (modus
through some kind of analytical process. The most operandi), law enforcement authorities may begin to
common mistake is to consider “intelligence” as assess current trends in crime to forecast, and to
synonymous with “information.” Information is not hamper the development of perceived future criminal
intelligence. Misuse also has led to the phrase activities. Intelligence provides the knowledge on
“collecting intelligence” instead of “collecting which to base decisions and select appropriate targets
information.” Although intelligence may be collected by for investigation. While the use of criminal intelligence
and shared with intelligence and security agencies, but is appropriate to support investigations, surveillance
eld ofcers/informants generally collect information operations and the prosecution of cases, it also
(or data). Despite the many denitions of “intelligence” provides law enforcement agencies with the ability to
that have been promulgated over the years, the effectively manage resources, budget, and meet their

The Nigerian Banker, Oct - Dec 2022 42

responsibility for crime prevention and control. and technical (image and signals intelligence)
resources. Use of classied information can
The explosion of internet resources in the last few years signicantly enhance the quality of an analytical
has opened new opportunities for nancial gain for product, as it is usually highly accurate; however, it can
criminals. This escalation of high-technology crime is a also make an analytical product signicantly less
challenging and relatively new arena for law actionable due to restrictions on dissemination, and
enforcement. Criminal organizations are more perhaps legal inhibitions.
sophisticated and dynamic than ever before. The
challenge for law enforcement is to be prepared for this Development of Criminal Intelligence Stages
increasing sophistication in order to reduce the impact The development of Criminal Intelligence involve
of criminal activities on our communities. In order to these stages and processes:
accomplish this, law enforcement agencies need to be i. Collection/Tasking – This is an element of
forward looking, assertive, and develop comprehensive management and tasking to the process, which
strategies to counteract the threat of organized crime represents the collection and processing large
groups. Criminal intelligence when tasked and used amount of information. Intelligence analysis
effectively, can be a major asset in the law enforcement requires collecting and processing large
arsenal. Information technology is very much key to amounts of information. Data collection is the
intelligence sharing. Particularly in this age of m o s t l a b o u r- i n t e n s i v e a s p e c t o f t h e
sophisticated multinational crime, including terrorism, intelligence process. Traditionally, it has been
a failure to share intelligence and information effectively the most emphasized segment of the process,
limits the efforts of all states in combating it. with law enforcement agencies and operatives
dedicating signicant resources to gathering
Sources of Intelligence-Gathering data. Historically, the following have been the
The three main types of sources of information are most common forms of data collection used in
open, closed and classied. intelligence units: Physical surveillance (either
Open Source (OSINT): This is information that is publicly in person or by videotape). Electronic
available. One very notable subset of open source surveillance (trap and trace or wiretap);
information is so called “grey literature”. It can consist Condential informants; Undercover
of research, technical, economic reports, “white operatives; Newspaper reports (now also
papers”, conference documentation, dissertations and Internet sources); Public records (e.g., deeds,
theses, discussion papers, subject-related newsletters, property tax records).
etc. One of the main difculties in working with this
type of source is evaluation as information available in ii. Evaluation – Once information is collected or
the public domain can frequently be biased, inaccurate gathered, it will be subjected to processes of
or sensationalized. verifying the reliability of its source, as well as
the relevance and validity of its content. It
Closed Source: This is information collected for a involves sifting through available data to
specic purpose with limited access and availability to eliminate useless, irrelevant, or incorrect
the general public. Closed source information is often information and to put the data into a logical
found in the form of structured databases. In the order. This organization makes it easier to
context of criminal intelligence analysis, these identify relationships among entities and
databases will largely include personal data collected as uncover relevant information.
part of ongoing targeting operations, or broader iii. Collation - Processing and collation involve
criminal records, vehicle registration data, weapons evaluating the data being entered. This entails
licensing, BVN and bank details of individuals etc. the ling, cross-referencing, ordering and
processing collated information, ready for use.
Classied Source: This is information collected by Information placed into an intelligence system
specically tasked covert means including use of human

The Nigerian Banker, Oct - Dec 2022 43

 must meet a standard of relevance—i.e., it of the world and these have resulted in an increasing
must be relevant to criminal activity steps that recognition within the security community that:
need to be taken. Thus, potential areas for i. Timely and actionable criminal intelligence is
further investigation may be recommended. essential to make an impact on the prevention,
iv. Analysis – Analysis converts information into reduction and investigation of serious and
intelligence. The actual analysis will then organized crime, particularly when it is of a
consider the information in context, draw trans-national nature. (“Timely” means that it
conclusions as to what it means and produce is provided in good time and “actionable”
reports, briengs and other documentation means that its detail and reliability supports the
representing that meaning. Analysis is quite
taking of action.);
simply, a process of deriving meaning from
ii. Criminal intelligence can play a signicant role
data. The analytic process tells what
in helping with the directing and prioritizing of
information is present or missing from the facts
resources in the prevention, reduction and
or evidence. Analysis includes synthesizing
detection of all forms of crime – through the
data, developing inferences or conclusions, and
identication and analysis of trends, modus
making recommendations for action based on
operandi, “hotspots” and criminals – both at
the data and inferences. These inferences
the national and transnational level; and
constitute the nished intelligence product.
iii. Intelligence can form the bedrock of an
v. Dissemination - The results or products of this
effective policing model – often termed
process will then be distributed, or
“ I n t e l l i g e n c e - L e d Po l i c i n g ” – w h e r e
“disseminated” to those who need to know it.
intelligence is essential to providing strategic
The “need to know” principle is fundamental
direction and central to the deployment of
to working with sensitive information and
personnel for all forms of tactical policing
intelligence. It means that, unless there is a
activity, including community policing and
clear professional reason for sharing
routine patrols. Whilst signicant differences
information with another person that
information should not be shared – even if he or will be seen in the understanding and
she has the appropriate security clearance level acceptance of information and intelligence as a
to receive it. The fewer people who know law enforcement tool, the fact remains that, in
about something, the easier it is to keep it many countries and international
condential. Intelligence reports kept within organizations, criminal intelligence has been
the intelligence unit, however fail to fulll their adopted as the law enforcement strategy of
mission. choice to drive policing forward in the next
vi. Re-evaluation – This is the task of examining century.
intelligence products to determine their
effectiveness. One way to re-evaluate 3. INTELLIGENCE-LED POLICING AND
intelligence is to include a feedback form with INSECURITY IN NIGERIA
each product that is disseminated. To make Intelligence-led policing involves developing and
sure the comments are valuable, the feedback maintaining a detailed and up-to-date picture of
form should ask specic questions relating to patterns of crime and criminality in order to intervene
the usefulness of the intelligence. most effectively to disrupt criminal networks and
remove prolic offenders. It is essentially about doing
Importance of Criminal Intelligence: the practical business of policing and law enforcement
In recent years there have been some important more smartly, incorporating and employing modern
developments concerning the use of criminal information technology and modern methods. The
intelligence by law enforcement agencies in many parts imperativeness for intelligence-led policing in our

The Nigerian Banker, Oct - Dec 2022 44

contemporary world is based on the fact that a more in keeping pace with emergent crimes which have
systematic approach to policing is needed now, because become highly mobile and complex. Information
as criminality becomes more sophisticated and mobile, technology has undoubtedly brought multiple
the identication of patterns is beyond the capacity of challenges to internal security management in Nigeria,
localised, informal, traditional and opportunistic as it has revolutionised crimes and criminality on one
methods of crime prevention and control. The hand, and on the other hand, has opened up policing to
employment of technology in policing enables better greater public scrutiny and accountability. The Nigeria
management of the ow of information that the police Police Force as the lead agency in internal security
receive about criminals, their behaviour, organisation management has continued to grapple with these
and modus operandi. Smarter action can then be taken internal security threats as there emerge, evolving
to control them through deterrence, disruption, arrest different operational plans and strategies, which
and detention. Up-to-date intelligence allows for involves some internal restructuring by creating
speedy, well targeted interventions in an ever-changing different units within the force with specic mandates
at tackling the rising insecurity challenge in Nigeria.
world of criminals and criminal organisations.
Some of the internal restructuring includes; the
Notwithstanding the challenges and uncertainties over
upgrade of the Intelligence unit, which was hitherto
the outcome effectiveness of intelligence-led policing as
domiciled with the Criminal Investigation Department
a means of reducing or preventing crime, it has come to
to a full department of the Force; and creation of
enjoy substantial plausibility and has thereby grown to
specialised tactical formations, like Counter-Terrorism
become one of the most effective and pragmatic
Unit (CTU), Special Forces, basically for combating
approaches to policing the prevailing organised and
violent and organised crimes. Also, community policing
complex criminalities in our modern society.
strategy was introduced in Nigeria, which seeks to
enhance the relationship between the community and
Intelligence-led policing core measures are:
the police, by partnering and collaborating with the
a. The focus on crime
community in prioritizing issues of crimes and how
b. The means used in addressing the problem are:
best to resolving them, for improved community
disruption and enforcement.
safety, law and order in the society. These efforts of the
c. The disruption and enforcement measures are
police have helped in no small measures in de-
aimed at reducing the problem by undermining
escalating crimes in Nigeria, although we cannot shout
the ability of criminals to do their business.
'eureka' for we are yet to attain the security serenity of
d. The disruption and enforcement activities are
our aspiration as a people due to some perennial and
informed by intelligence work, aimed as
crippling challenges to effective utilisation of
understanding the business and those involved.
intelligence-led police in internal security management
e. The tactics are coordinated at a relevant level.
f. The organization demands the involvement of in Nigeria
all security agencies, as no security agency has
all it takes to solve all incidents of crime in the Challenges to Intelligence-Led Policing in
society. Nigeria:
i. Continued ofcer involvement in response-
The Nigerian state since its independence in October, led policing creating problems in setting aside
time for proactive work.
1960 has been fraught with varying degrees of threats
ii. Difculties in creating and maintaining a steady
and different internal security challenges which have
ow of intelligence, analysis, preparation of
grown in organisation, complexity and lethality. There is
target packages and conduct of operations.
no doubt that the 21st century revolution in technology
iii. Lack of training and retraining, senior ofcers'
which birthed information superhighway, reduced the
commitment and poor communication
world to a global community, has further challenged the
between security agencies, and inter-agency
traditional policing methods and strategies of the NPF

The Nigerian Banker, Oct - Dec 2022 45

 turf wars. best to interdict them through intelligence-led
iv. Unsympathetic attitudes, cultural resistance policing. Training and retraining programmes,
and low morale among ofcers performing less therefore, should be prioritized and
attractive roles. emphasized. This also involves huge cost.
v. Uncooperative attitude of the members of the Hence, the argument for increased budgetary
public due to colonial hangover that created a provisions to the police.
'them versus us' attitude between the police e. The current structure of intelligence sharing,
and community. both within the policy, and with other security
vi. Huge cost involved in information-gathering, agencies need to be restructured, as the
processing, analysis, and synthesization into bureaucratic processes of bottom-to-top, and
actionable intelligence. top-to-bottom have proved inefcient in the
vii. Some of these emergent and violent crimes in proactive utilization of actionable intelligence.
our contemporary society enjoy ethnic f. Technologization of policing and law
sentiments and tribal solidarity, thereby enforcement is indispensable to effective
making the information gathering very intelligence gathering and sharing. The
frustrating. employment of technology should be
viii. Over-bureaucratization of intelligence-sharing prioritized and budgeted for by the
process, often times delay proactive action of government, if intelligence-led policing must
the police and other law enforcement help in containing organized criminality in
agencies. Nigeria.

Recommendations: 4. CONCLUSION:
In view of the imperativeness of Intelligence-led The world being policed is changing rapidly, the police
policing in Nigeria, as a pragmatic policing approach to and indeed other law enforcement agencies must
curbing insecurity in our country, the following change their tactics and approaches to crime
recommendations are hereby made:
prevention and control in the society. Emerging new
a. Intelligence-led policing involves huge cost.
technologies are beginning to offer policing agencies
Improved funding to the police is hereby
considerable opportunities, and the Nigeria Police and
advocated to enable the acquisition of
other law enforcement agencies in our society must
necessary modern technological tools for
key into it, if we must effectively tackle the myriad of
policing and law enforcement.
internal security threats, bedevilling our country.
b. Private Sector partnership and collaboration is
Intelligence-led policing remains an effective approach
advocated in assisting and supporting the police
to modern policing, and if religiously applied, it will go a
towards logistics acquisition and information
long way in solving the insecurity challenges in Nigeria.
gathering.
c. The polygamous nature of the security
Although, there are many challenges scuttling its
architecture in Nigeria should be harnessed
effective application and employment of Nigeria, it is
through joint trainings and operations to de-
my belief that if the recommendations proffered in this
escalate inter-agency turf war in our
paper are considered and used; that crimes and
management of internal security, through
organised criminality in no distant future will be
seamless intelligence sharing.
reduced to a minimum in Nigeria.
d. The importance of training and retraining in the
effective implementation of intelligence-led
policing cannot be over-emphasized, as law
enforcement agents need to be regularly
trained on new crimes and patterns, and how

The Nigerian Banker, Oct - Dec 2022 46

 Happy Birthday
October November
MRS. TOMI SOMEFUN, FCIB DR. JIM OVIA, CON, FCIB
MD/CEO, UNITY BANK PLC FOUNDER/CHAIRMAN,
OCT 3 ZENITH BANK PLC NOV 4

MR. KENNEDY UZOKA, FCIB MRS. JULIET A. MADUBUEZE, OON, FCIB

FORMER, GROUP MANAGING PAST PRESIDENT, CIBN NOV 7
DIRECTOR/CEO, UBA PLC OCT 3
HRH EZE PROF. G. O. NWANKWO, OON, FCIB
MR. JOHNSON OLUFEMI EKUNDAYO, FCIB PAST PRESIDENT, CIBN NOV 9
PAST PRESIDENT, CIBN
OCT 11 MR. A.A. ADENUBI, FCIB
MR. HASSAN USMAN, FCIB PAST REGISTRAR, CIBN NOV 11
MD/CEO, JAIZ BANK PLC
OCT 15 MR. SAMSON OLANIRAN OLAYINKA, FCIB
MANAGING DIRECTOR/CEO,
MRS. MOJISOLA ADEBISI BAKARE-ASIERU, FCIB KEYSTONE BANK LTD NOV 14
NATIONAL TREASURER, CIBN
OCT 24 DEACON SEGUN J. AJIBOLA, PH.D., FCIB
PAST PRESIDENT, CIBN
DR. DEMOLA SOGUNLE, FCIB NOV 15
MD/CEO, STANBIC-IBTC HOLDING PLC
OCT 25 MR. URUM KALU EKE, MFR, FCIB
FORMER GMD/CEO, FBN HOLDINGS
DR. ERASTUS B. O. AKINGBOLA, OON, FCIB NOV 20
PAST PRESIDENT, CIBN
OCT 26 MRS. YVONNE ISICHEI, FCIB
MEMBER, GOVERNING COUNCIL, CIBN
MRS. AISHAH N, AHMAD, FCIB NOV 24
DEPUTY GOVERNOR, FINANCIAL SYSTEMS
STABILITY DIRECTORATE, CBN PROF PIUS OLADEJI OLANREWAJU, FCIB
OCT 26 1st VICE PRESIDENT /CHAIRMAN BOARD OF
FELLOWS ,CIBN NOV 25
MR. ANYA DUROHA, FCIB
FORMER MD/CEO, MRS. MARY UDUK, FCIB
NOVA MERCHANT BANK LTD FORMER AG. MD/CEO, SEC
OCT 30 NOV 25

MR. ADEMOLA ADEBISE, FCIB

MD/CEO, WEMA BANK PLC
OCT 31

The Nigerian Banker, Oct - Dec 2022 47

 Happy Birthday
December SEPTEMBER
MR. KAYODE AKINKUGBE, FCIB MRS. IBUKUN AWOSIKA, FCIB,
MD/CE, FBN QUEST MERCHANT BANK FORMER CHAIRMAN, FBN LTD
DEC 5 DEC 24

MRS. FUNMI BALOGUN, FCIB, MR. VICTOR ODOZI, FCIB

FORMER PERMANENT SECRETARY MIN OF MEMBER, CIBN BOARD OF FELLOWS & FORMER
FINANCE, LAGOS STATE DEPUTY GOVERNOR, CBN
DEC 6 DEC 24

MRS. SOLA DAVID-BORHA, FCIB MR. TUNDE LEMO, OFR, FCIB

CHIEF EXECUTIVE OF AFRICA REGION, CHAIRMAN, FEDERAL ROADS MAINTENANCE
STANDARD BANK GROUP AGENCY (FERMA) & FORMER DEPUTY
DEC 10 GOVERNOR, CBN
DEC 28
MR. SEYE AWOJOBI, Ph.D, FCIB
REGISTRAR/CHIEF EXECUTIVE, CIBN
DEC 10

The Nigerian Banker, Oct - Dec 2022 48

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