Business
Banking Sector Crisis: CBN Admits Failure To Regulate Subsidiaries
The Central Bank of Nigeria (CBN) has attributed the crisis in the banking industry to its failure to regulate subsidiaries of banks.
Chief Samuel Oni, Director of Banking Supervision with the CBN stated this in Lagos while addressing participants at the 6th annual corporate financing report summit and dinner organised by the Nigerian Accounting Standards Board (NASB).
He admitted that the failure to regulate the subsidiaries of banks was an oversight on the part of the CBN because the management control of the subsidiaries was not done at arms length.
He said in order to address the anomaly it is imperative for banks to pioneer the adoption of International Financial Reporting Standards (IFRS) in the country.
The Director said the recent special audit of banks by CBN and the Nigeria Deposit Insurance Corporation (NDIC) would make them to develop a system that could bring out early warning signals to the regulators and make people to account for problems in the industry.
Oni also said that NASB and Securities and Exchange Commission (SEC) should make it mandatory for big companies in the country to be listed on the Nigerian Stock Exchange.
Chairman, Governing Council of NASB, Mr Michael Popoola, said in his address of welcome that this year’s summit theme ‘Financial reporting for private sector led economic growth was chosen in order to bring to the fore the need for the economy to be restructured towards an economic system where the private sector would be the driving force towards an economic system where the private sector would be the driving force for national development .
He said in order to achieve this, financial reporting must be credible and reliable to support a free market economy as currently obtained in the developed economies of the world.
The major objective of the yearly summit is to provide a unique opportunity for preparers, users and all stakeholders of published financial statements to meet and exchange views on issues affecting credible financial reporting in the country.