President Muhammadu Buhari has assented to the Banks and Other Financial Institutions Act (BOFIA) 2020.
The new BOFIA, repeals the extant Banks and Other Financial Institutions Act 1991 as amended.
A statement signed by the Senior Special Assistant to the President on Media and Publicity, Garba Shehu said the monumental piece of legislation is expected to enhance the soundness and resilience of the financial system for sustainable growth and development of the Nigerian economy.
He said BOFI Act 2020 updates the enabling law in response to developments and significant evolution in the financial sector over the last two decades. It will increase the appetite of banks and other financial institutions to channel much needed credit to the real sector to support economic recovery and promote sustainable growth.
According to the statement, BOFIA introduces a credit tribunal to improve loan recovery and address the incidence of high non-performing loans within the financial system, which has been a key deterrent to lending by financial institutions.
Mr. Garba noted that the new Act will further strengthen the regulatory and supervisory framework for the financial industry and provides additional tools for managing failing institutions and systemic distress to preserve financial stability amongst others adding that the Central Bank of Nigeria will hold structured engagements with stakeholders across various sectors of the economy on critical aspects of the Act in the coming months.
He emphasized that the enactment of the BOFI Act 2020 was a historic and significant achievement, which is indicative of effective and productive collaboration between the Executive and Legislature arms of Government.