Banking History In Nigeria

Nigerian Central Bank & Logo. Photo Credit: naijaparrot.com

The Nigerian central bank was established in 1958 by the central bank of Nigeria act. The CBN became operational on 1^st July 1958. The main aim of the CBN as duly stated in the 1958 act was primarily to maintain Nigeria’s external reserve, ensure stability of its monetary policies by providing great financial space to the banking sector and regulate the activities of other banks with Nigeria.

Before the establishment of the central bank in 1958, banking activities in Nigeria was hugely uncontrolled. An investigation in 1948 to ascertain the banking and financial dealings in Nigeria was conducted by G.O Paton and his finding and report became the blueprint for the
very first banking activities instituted in Nigeria.

This was known as the 1952 banking ordinance. 

The adoption of this ordinance ensured that banking and financial dealings within Nigeria were done commercially in an orderly manner. The era of this ordinance enabled huge growth witnessed in the banking industry. The unprecedented growth was accompanied with disappointment. Few banks by the year 1958 had failed. In an effort to halt the failure of these banks in future, a ground for indigenous take over was put in place.

In the year 1985, a drafted bill to establish the CBN was passed to the then house of representative of the federal republic of Nigeria. The CBN act became implemented in 1^st July 1959.

The central bank functions were to serve as the federal government’s watchdog for controlling and supervising the activities of other banks in Nigeria. They were to monitor and ensured that monetary policies instituted by commercial banks in the country were in line with the request of the national budget.

Governors

Listed below is the central bank of Nigeria’s governors from 1958 till date.

 Roy Pentelow Fenton     24 July 1958 - 24 July 1963
Aliyu Mai-Borno            25 July 1963 – 22 June 1967
Clement Nyong Isong     15 August 1967 – 22 Sept 1975
Adamu Ciroma               24 Sept 1975 – 28 June 1977
Ola Vincent                     28 June 1977 – 28 June 1982
Abudulkadir Ahmed        28 June 1982 – 30 Sept 1993
Paul Agbai Ogunma         1 Oct. 1993 – 29 May 1999
Joseph Oladele Sanusi     29 May 1999 – 29 May 2004
Chukuma Soludo             29 May 2004 – 29 May 2009
Sanusi Lamido Sanusi       3 June 2009 – Incumbent.

Presently, the central bank of Nigeria is headed by Lamido Sanusi. The CBN enforcement of the N25billion recapitalization during Mr. Charles Soludo’s regime saw many commercial banks in Nigeria folded. This tool was used to strengthen the banking sector allowing only banks that could meet up with the capital base of N25billion to operate. This re capitalization policy introduced by the central bank as help to strengthened the commercial banks in Nigeria.