By Babajide Komolafe

The Chareterd Institute of Bankers of Nigeria (CIBN) has said the the Central Bank of Nigeria  (CBN) Act is in line with global best practices with respect to the autonomy of the apex bank.

The Institute was one of the selected institutions invited by the National Assembly to make presentation at the public hearing on the amendment of CBN Act on May 28, 2012, at Abuja, stated that the CBN act of 2007 was in line with International best practices.

“After examining the governance structure of Central Banks across the developed and emerging/frontier economies and the impact on central bank independence, we found out that the CBN Act 2007 is in line with International best practices”, said  Mr. Segun Aina, CIBN President,  who made the presentation on behalf of the Institute and the banking industry.

He said  that an independent central bank would be in the best position to ensure financial stability, sound economic performance, stable economic growth, access to resources to achieve its policy objectives, a positive international perception among other benefits than when under control of an external body or agency.

Mr. Aina observed that Central Banks all over the world have the core mandate of ensuring monetary and price stability, non-inflationary growth as well as the responsibility of ensuring a sound and stable financial system, in addition to other developmental functions.

These mandates and functions are peculiar to central banks, and no other institution performs such functions”, Aina said.? ?Similarly, Alhaji Amusa Oladimeji Otiti, a Past President and Chairman of Body of Past Presidents of the Institute affirmed the position of the Institute by saying that the apex bank should continue to have its operational and financial autonomy and the budget should not be subjected to financial appropriations.

“I strongly implore members of the Senate and House of Assembly to leave the CBN Act alone as it was conceived by the founding Fathers in 1958”. Alhaji Otiti who spoke on the floor of the house through the CIBN president, Mr. Segun Aina also noted that Central banks all over the world are autonomous.

Another Past President of the Institute, HRH Prof. Green Nwankwo, OON, FCIB alongside Managing Director/Chief Executives of Banks spoke-out in total support of CBN autonomy.

The Institute’s position is a reaction to the plans by the National Assembly to amend the Act establishing the Central Bank of Nigeria through the Senate whose intention is to enhance the powers of the CBN to prohibit transactions with foreign currencies in Nigeria.

The Upper House also wants to divest the Board of Directors of approval of the Annual budget by compelling the Board to submit its annual budget to the National Assembly for approval.