CBN Takes Action: 132 Microfinance Banks Lose Licenses
In a significant move by the Central Bank of Nigeria (CBN), the licenses of 132 Microfinance Banks (MFBs), three finance companies, and four primary mortgage banks have been revoked. This decision comes as a result of these financial institutions failing to fulfill their obligations and deviating from their licensed operations for an uninterrupted period of six months. The CBN’s actions align with the provisions outlined in the Banks and Other Financial Institutions Act (BOFIA) of 2020, Act No. 5.
Revocation of Licenses:
CBN Governor, Godwin Emefiele, formalized the license revocation through a gazette. In exercise of the powers granted under Section 12 of BOFIA 2020, Act No. 5, Emefiele announced the revocation of licenses for the Microfinance Banks, Finance Companies, and Primary Mortgage Banks as specified in Schedules I, II, and III, respectively.
Impacted Microfinance Banks:
Among the Microfinance Banks affected by the license revocation are Atlas Microfinance Bank, Bluewhales Microfinance Bank, Everest Microfinance Bank, Mainsail Microfinance Bank, Nopov Microfinance Bank, Ohon Microfinance Bank, Premium Microfinance Bank, and Statesman Microfinance Bank. Additionally, Manny Microfinance Bank, Reality Microfinance Bank, Osina Microfinance Bank, Zikado Microfinance Bank, Taraba Microfinance Bank, Ndiagu Microfinance Bank, and others have also lost their licenses.
Finance Companies and Primary Mortgage Banks:
In addition to the MFBs, three finance companies—HHL Invest & Trust Limited, TFS Finance Limited, and Treasures & Trust Limited—also faced the revocation of their licenses. Similarly, the licenses of four primary mortgage banks, namely Resort Savings & Loans, Safetrust Mortgage Bank, Adamawa Savings & Loans, and Kogi Savings & Loans, were revoked by the CBN.
Reasons for Revocation:
The CBN’s action was prompted by the failure of these financial institutions to adhere to the conditions imposed upon them and fulfill their regulatory obligations. As stipulated by the provisions of BOFIA 2020, Act No. 5, these entities neglected their prescribed activities and ceased operations in their designated fields for a continuous period of six months.
The revocation of licenses for 132 Microfinance Banks, three finance companies, and four primary mortgage banks by the CBN serves as a reminder of the regulatory measures in place to ensure compliance and the protection of the Nigerian financial system. This decisive action by the CBN emphasizes the importance of upholding the responsibilities and obligations associated with operating within the banking and financial sectors.