![\"Functions](\"https:\/\/nigerianfinder.com\/wp-content\/uploads\/2019\/06\/Functions-of-the-CBN.jpg\")
<\/p>\nThe Central Bank of Nigeria is the foremost financial authority in Nigeria. This bank was mandated by the 1958 Act of Parliament and began operations on 1st of July, 1959. The CBN Act, however, has been amended in 1991, 1993,1997,1998,1999 and 2007.<\/p>\n
Under the CBN Act of 2007 of the Federal Republic of Nigeria, the Central bank is charged with the overseeing, control and administration of the monetary and financial sector policies of the Nigerian government.<\/p>\n
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In the period between 1892 and 1952, an inquiry was made by the colonial administration under the leadership of G.D Paton. This was an investigation into the banking practices in Nigeria at the time. It must be noted that prior to this inquiry, there was no defined structure for Nigeria\u2019s banking industry. Consequently, the GD Paton report was the basis of the first banking legislation in the country which was the banking ordinance of 1952.\u00a0 The ordinance was made to prevent the establishment of nonviable banks and to ensure orderly commercial banking in the country. This ordinance paved the way for rapid growth in the banking industry but came with its own disappointments as some banks folded up. It was in order to prevent such future failures and also promote indigenous control in the banking sector; draft legislation for the establishment of the Central Bank of Nigeria was presented to the House of Representatives in March 1958. The Central Bank of Nigeria came into full operations on July 1, 1959.<\/p>\n
In 1986, the Structural Adjustment Programme (SAP) was adopted and this brought about some deregulation and liberalization measures and resulted in the establishment of more banks and other financial institutions. In 1997, the limited autonomy of the CBN was removed completely by CBN Amendment Decree No. 3 and BOFI (Amended)] Decree No. 4.<\/p>\n
The Central Bank Act (1997 amendments) put the CBN under the supervision of the Ministry of Finance. This amendment left the CBN with little roles in the governance of other financial institutions and generally subjugated the powers of the CBN. Therefore, this decree was repealed and replaced by the CBN (Amendment) Decree No 37. This decree gave the CBN a measure of operational autonomy to enable it to carry out its functions and enhance efficiency.<\/p>\n
The Central Bank of Nigeria issued its first treasury bills in April 1960 and treasury certificate in 1968<\/p>\n
The Lagos Stock Exchange by the Central bank was launched in May 1961 to provide authorized banks with a structure by which they could quickly exchange and clear checks. By July 1, 1961, the Central bank had issued all denominations of new Nigerian notes and coins and successfully recovered the money of the West African Currency Board. The Capital issue committee now known as the Securities and Exchange Committee was also established in the early 1970s.<\/p>\n
The Central bank of Nigeria currently operates within the legal framework of the CBN Act of 2007 which repealed the CBN Act of 1991 and all its amendments. This Act provides that the CBN functions as a fully autonomous body with the aim of promoting stability and continuity in economic management and also providing economic and financial advice to the government.<\/p>\n
After the Nigerian civil war, the Nigerian government wanted to be more active in the country\u2019s economic development, in line with this desire, the CBN decided to supplement for failures in credit allocations. The bank began to lend directly to customers. This was against the original intention that the central bank work through commercial banks. Even though this was due to the indigenisation policy of the government<\/p>\n
In 1979, The Central bank initiated credit limits for bank lending. This was so credits would be made available to sectors of the economy that suffered neglect, such as agriculture and manufacturing. However, most banks did not adhere to these credit limits and the central bank was not able to curtail the prevalence of short term loan maturities. In an effort to balance this, the Bank of Commerce and industry was created to serve as a universal bank. However, the bank did not fulfil its mission.<\/p>\n
The central bank played a crucial role in the growth and financial credibility of Nigerian commercial banks by making sure that all the financial banks operating in the country had a capital base (required reserves). The new requirement was 25,000,000,000.00 Naira at the time. This was to ensure that bank customers did not bear losses alone if there were bank failures.<\/p>\n
The Central Bank was also active in promoting financial inclusion policy in Nigeria. The bank is, in fact, a leading member of the Alliance for Financial Inclusion. It is also one of the original 17 regulatory institutions to make specific national commitments to financial inclusion under the Maya Declaration [5] during the 2011 Global Policy Forum held in Mexico. The CBN has also ensured that all Banks in Nigeria have a uniform end yearly<\/p>\n
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The Central Bank of Nigeria is the foremost financial authority in Nigeria. This bank was mandated by the 1958 Act … <\/p>\n