President Muhammadu Buhari on Thursday assented to the Banks and Other Financial Institutions Act 2020 (BOFIs) to strengthen the Nigerian banking sector and support financial institutions.
In a few tweets put out by the president, he said the historic and significant achievement will enhance the soundness and resilience of Nigeria’s finance system.
The tweets read, “Yesterday, November 12, 2020, I assented to the Banks and Other Financial Institutions Act 2020, which repeals the extant Banks and Other Financial Institutions Act 1991 as-amended.”
“The BOFI Act 2020 is a historic and significant achievement that will enhance the soundness and resilience of Nigeria’s financial system. It is also yet another indication of effective and productive collaboration between the Executive and Legislative arms of Government.”
Explaining the new piece of legislation, the Senior Special Assistant to the President on Media and Publicity, Garba Shehu, said “The BOFI Act 2020 updates the enabling law in response to developments and significant evolution in the financial sector over the last two decades. It will increase the appetite of banks and other financial institutions to channel much-needed credit to the real sector to support economic recovery and promote sustainable growth.
“In this respect, it introduces a credit tribunal to improve loan recovery and address the incidence of high non-performing loans within the financial system, which has been a key deterrent to lending by financial institutions.
“Furthermore, it strengthens the regulatory and supervisory framework for the financial industry and provides additional tools for managing failing institutions and systemic distress to preserve financial stability amongst others. The Central Bank of Nigeria will hold structured engagements with stakeholders across various sectors of the economy on critical aspects of the Act in the coming months.
“This enactment of the BOFI Act 2020 is a historic and significant achievement, which is indicative of effective and productive collaboration between the Executive and Legislature arms of government.”