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The Central Bank of Nigeria has ordered bank directors with non-performing insider-related loans to step down immediately.

Insider loans refer to loans granted by a bank to its own executives, directors, employees, major shareholders, or related parties.

The directive was issued in a circular signed by the Acting Director of Banking Supervision, Adetona Adedeji, on Monday.

According to the CBN, the decision aims to strengthen corporate governance and improve risk management in the banking sector.

To minimise financial risks, the apex bank instructed banks to take action by recovering debts through collateral enforcement and seizing the shareholdings of affected directors.

“Directors with non-performing insider-related facilities are required to step down immediately from the board, while the bank should commence immediate remediation of the loans through the recovery of the collaterals, including the shareholdings of the affected directors,” the circular reads.

https://punchng.com/cbn-orders-bank-directors-with-bad-loans-to-resign/