CBN Restricts Foreign Banks From ‘Banking Businesses’ – Business

The Central Bank of Nigeria (CBN) has
barred foreign banks operating
representative offices in Nigeria from
providing services designated as
‘banking businesses’ among other
aspects of services.

The apex bank disclosed this yesterday
in its Guidelines for the regulation of
representatives offices of foreign banks
in Nigeria.

The guideline, according to the CBN,
complements its regulation on the
scope of banking activities and
ancillary matters.

Listing the non-permissible activities
for foreign banks operating in the
country, the guideline stated:
“Approved Representative Offices shall
not engage in the following services/
activities; Provision of services
designated in Nigeria as banking
business;

Provision of any commercial
or trading activity that may lead to the
issuance of invoices for services
rendered; and Acceptance of orders on
behalf of the foreign parent; and
engage directly in any financial
transaction.’’

However, the CBN guideline added:
“Representative offices of foreign
banks serve an important purpose of
showcasing the brand and services of
its parent company. It can also
stimulate foreign direct investment to
the host country by connecting capital
to various investment opportunities.

“It is in view of these that the CBN
issues these guidelines, to specify the
requirements for the licensing and
operations of approved representative
offices of foreign banks in Nigeria.”

Source

Author: David

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