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A bill aimed at amending the Central Bank of Nigeria (CBN) Act successfully passed its Second Reading in the House of Representatives on Thursday.
The proposed amendment, championed by Francis Waive, the bill’s sponsor, targets key aspects of the CBN Act to improve the effectiveness, transparency, and accountability of the apex bank and its functions.
During the plenary session, Waive, representing Ughelli North/South/Udu Federal Constituency in Delta State, highlighted the necessity of amending Section 6 of the CBN Act. He stressed the importance of separating the Chairman of the Board of the apex bank from the CBN Governor.
Waive explained, “The proposed amendment introduces a crucial change in the composition of the CBN’s Board of Directors as outlined in Section 6 of the Principal Act. The proposed amendment adds a new paragraph, Section 6(2)(a), which mandates that the Chairman of the Board shall be a Former Governor of the CBN, a former Chairman of the Bank, or a former Managing Director of a bank.”
According to the lawmaker, this change aims to introduce an essential shift by requiring the Chairman to have a background outside of the current CBN leadership. Separating the Chairman from the Governor is expected to bolster independence, oversight, and provide a more effective system of checks and balances within the CBN’s governance structure.
Waive emphasized that this differentiation reduces the concentration of power, enhances accountability, and offers an unbiased oversight avenue for the CBN’s operations. The amendment seeks to prevent groupthink and reduce the potential for conflicts of interest.
“A Chairman selected from outside the current leadership of the Bank diminishes the likelihood of conflicts of interest that could arise when the Governor also assumes the role of the Chairman. This separation reduces the risk of policy decisions being influenced by personal or vested interests,” Waive explained.
The bill also aims to amend Section 7(1) to improve the operational efficiency and accountability of the apex bank to the Nigerian public.
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