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No Plan to Shutdown 600 MFBs, Says CBN

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Story:  Obinna Chima


The Central Bank of Nigeria (CBN) Tuesday said it has no plan to close down 600 microfinance banks (MFBs).

CBN Director, Other Financial Institutions Supervision Department (OFISD), Mr. Olufemi Fabamwo described a report that 600 MFBs were facing imminent closure as misleading.
However, THISDAY gathered that out of 832 MFBs in the country, four of them are now National; 75 are State, and the remaining 753 are Unit MFBs.

Fabamwo said the CBN was satisfied with the state of the microfinance industry and the financial condition of the MFBs.  He expressed concern that the report could result in de-marketing in the sub-sector and thus, undermine public confidence which according to him “is capable of precipitating panic withdrawals by depositors and investors in the MFBs.”

He noted that the microfinance sub-sector has been effectively regulated by the CBN and the Nigeria Deposit Insurance Corporation (NDIC).

According to Fabamwo, all MFBs are examined at least once a year, while some are examined more than once, depending on the exigencies of the situation, with follow-up visits to ensure that examiners’ recommendations are implemented and corrective actions are taken by the operators of the MFBs in order to engender stability in the microfinance space.

Article Credit: ThisDay Newspaper

Updated 5 Years ago

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