Regulatory Alerts2019-08-23 | FPR/DIR/GEN/PAR/02/009Exposure Draft on the Prudential Guidelines for Development Finance Institutions
The Central Bank of Nigeria (CBN) issued revised Prudential Guidelines for deposit money banks in Nigeria in June 2010 to enhance the quality of banks' assets. Given the impact of developments on different classes of financial institutions, the CBN is proposing sector-specific Guidelines for Development Finance Institutions (DFIs). These Guidelines cover risk management, credit policy, lending limits, market and operational risk management, and other areas. DFIs must have a comprehensive credit policy approved by their board of directors, including eligibility requirements for borrowers, products offered, and terms and conditions for granting loans. The CBN sets maximum loan limits and requires DFIs to institute strategies to manage market and operational risks. The Guidelines also address liquidity requirements, capital adequacy, and restrictions on dividend declarations.