CBN Revokes Licenses of 46 Microfinance Banks
The Central Bank of Nigeria (CBN) has announced the revocation of licenses for 46 microfinance banks that failed to comply with regulatory requirements necessary for continued operation. The decision was made public on Wednesday and is rooted in the CBN’s authority under Sections 12 and 13 of the Banks and Other Financial Institutions Act, 2020 (BOFIA).
According to the apex bank, reasons for the license cancellations include insufficient assets to meet debt obligations, the cessation of operations without prior regulatory approval, and a lack of engagement in financial intermediation. In addition, banks that did not commence operations within 12 months of obtaining their license or failed to maintain a minimum capital threshold while avoiding losses also faced revocation.
Distribution of Revocation by State
Kano State led the list with 13 banks having their licenses revoked, followed by Lagos, which saw 8 institutions affected. Other states, including Abia, the Federal Capital Territory (Abuja), Kaduna, Kebbi, Niger, Ogun, and Plateau, each had two banks on the list. Meanwhile, Anambra, Akwa Ibom, Bayelsa, Benue, Cross River, Delta, Kwara, Ondo, Osun, Oyo, and Rivers recorded a single bank each.
The recent actions by the CBN categorize the revoked banks into three tiers: 25 were identified as Tier 2 microfinance banks, 18 as Tier 1, and 3 as state microfinance banks. This categorization highlights the CBN’s commitment to maintaining a robust regulatory framework within Nigeria’s financial landscape.
Regulatory Intent Behind Revocations
The central bank emphasized that the revocation of licenses is part of its broader strategy to enhance regulatory oversight of the financial system. By enforcing compliance with current laws and prudential regulations, the CBN aims to bolster the integrity of licensed financial institutions and ensure their sustainable operation.
Among the microfinance banks that lost their licenses are a diverse array of institutions from different states, reflecting a widespread challenge within the sector. Some notable mentions include Gold MFB in Lagos, Bompai MFB and Ajuwa MFB in Kano, and Minjise Churchill MFB in Rivers.
List of Revoked Microfinance Banks
The complete list of revoked licenses is as follows:
- Minjise Churchill MFB – Tier 1 – Rivers
- Merchant MFB – Tier 2 – Abia
- Jammer MFB – Tier 1 – Kwara
- Busu MFB – Tier 2 – Niger
- Gold MFB – Tier 1 – Lagos
- Zain MFB (formerly Dawakin Tofa MFB) – Tier 2 – Kano
- Bompai MFB – Tier 1 – Kano
- Ajuwa MFB (formerly Gezawa MFB) – Tier 2 – Kano
- NOW NOW DIGITAL MFB – Tier 2 – Kano
- Crystabel Microfinance Bank – Tier 1 – Bayelsa
- Chanelle MFB – State – Lagos
- Abia SME MFB – Tier 1 – Abia
- Kamba MFB – Tier 2 – Kebbi
- Iwade MFB – Tier 2 – Ogun
- Winview MFB – Tier 1 – Abuja (FCT)
- Zulu MFB – Tier 2 – Kebbi
- Minjibir MFB – Tier 1 – Kano
- Shanono MFB – Tier 2 – Kano
- Sumaila MFB – Tier 2 – Kano
- Limin Gad MFB – Tier 2 – Kano
- Mwagavuru MFB – State – Plateau
- Sycamore MFB – Tier 2 – Kano
- TOFA MFB – Tier 2 – Kano
- Safegate MFB – Tier 1 – Lagos
- Creekline MFB – Tier 2 – Delta
- Bester MFB – Tier 1 – Oyo
- Living Spring MFB – Tier 1 – Cross River
- Apple MFB – Tier 2 – Ogun
- Stanford MFB – State – Uyo
- Frontline MFB – Tier 2 – Anambra
- Zafek MFB – Tier 2 – Kaduna
- Supreme MFB – Tier 1 – Lagos
- Bezindoko MFB – Tier 2 – Niger
- Kanopoli MFB – Tier 1 – Kano
- Belbank MFB (formerly Tsaniyawa MFB) – Tier 2 – Kano
- Yennene MFB – Tier 2 – Plateau
- Creditville MFB – Tier 1 – Lagos
- MBAG MFB – Tier 1 – Lagos
- STRAIGHT SAHARA MFB – Tier 1 – Benue
- OURPASS MFB – Tier 2 – Ondo
- VERDANT MFB – Tier 1 – Lagos
- BASAWA MFB – Tier 2 – Kaduna
- CASHA MFB – Tier 2 – Abuja (FCT)
- ESTEEM MFB – Tier 2 – Kano
- ENTERPRENEUR MFB – Lagos
- AVANTUS MFB – Tier 2 – Osun
This situation underscores the crucial role that compliance plays in the financial sector and emphasizes the CBN’s ongoing efforts to ensure safety and soundness within Nigeria’s banking environment.
