Regulatory Alerts2017-04-28 | FPR/DIR/GEN/CIR/06/017The Guide to Charges by Banks and Other Financial Institutions in Nigeria 2017 (UPDATED)
The disclosure requirements for contingent liabilities in banking products include clear information on the product, its purpose, terms and conditions, and how it can crystallize. These requirements help protect borrowers by ensuring they are fully aware of the obligations and risks associated with each financial instrument. The key areas that must be covered in a loan or overdraft agreement are the purpose of the facility, the interest rate, the repayment schedule, collateral (if any), insurance requirements, repayment terms, and the loan tenure. In addition, certain specific contingent liability products such as bid bonds, performance bonds, advance payment guarantees, bank guarantees, and indemnities require clear disclosure of their conditions and when they can crystallize.