1.0 Analysis of the Work
Before Nigeria attained her independence, the country had been struggling to get her own central bank. But after some years of independence, this became real. It is as a result of this struggle that led Mr. Fisher in 1953 to sate the need for banking in then Colonized Nigeria. To have a supervisory authority that will oversee the activities of commercial banks and merchant bank, as a result of continuous depression of banks, the central bank was established , as it would oversee and supervise the activities of other banks in the country. The number of depressed banks had been on the increase, creating more responsibilities and anxiety for the supervisory in its strict sence and referred for tehneed for framework of laws and rules under which bank must operate.
Ebhodagbe (1995) Narrowly defined supervisory as referring to the banking agencies monetary situational stand of banks under thir jurisdiction and to the on going enforcement of banking, regulations and policies.
However, banking supervision is a matter of judgement and prudential analysis to ensure that individual banks observe laid down laws and operate within prescribed monetary policy objectives, example section 17b of BOFIA 1991 provides that no licensed banks shall pay dividend until adequate provision of bad and doubtful debts have been traded to the satisfaction of the CBN as contained in the prudential guideline Kanu (2003).
The reasons behind bank supervision is to protect bank depositors and the payment system as well as preservation of sound financial practices like monetary and financial stability , efficient and competitive financial system, consumer protection etc to achieve the purpose of the CBN. Ebhodah (1997) measures were facilitated to form a formal framework for the coordination of regulaton and supervisory activities in Nigerias financial services coordinating committee (FSCC) to address more efficiently through consultations and regular inter agency meetings, and addressing issues of common concern to both the regulatory and supervisory bodies alike the nam of the committee was subsequently changed to Financial service coordinating committee (FSCC) , although the comitte had been in existence since 1994, as it was only accorded legal states by the 2005 amendment to section 38 of the CBN ACT 1991 and made formally inadequate by the Governor in may 2009. Okpora (1997).
1.1 Regulation And Supervisory Framework
Banking and Finance activity (ies) are governed by rules and regulations which are to be reviewed from time to time to outlet the changing economic environment Among some of the recent rides and status which govern the operation of banks is the CBN decree 24 of 2009 as amended, banks and other financial institutions (BOFIA) Decree no 25 of 1991 as amended, the dishonored cheque (offender) Decree No 18 of 1994 as amended, the money laundering Decree of No 3, of 1995, the National insurance commission Decree No 1 of 1997 and the three insurance decree of no 2 of 1997 provides the regulatory framework for the operation of hte insurance industry. Other relevant laws which affects the operation of the financial system includes the foreign exchange montoring and miscellaneous provision Decree No 17 of 1995, Nigerian investment and promotion commission Decree No 16 of 1995, company and Allied matters Decree of 1990, which provides the legal toll for resuscitating unit trust operations in a country Ezinwa (2002).
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