The Nigerian financial system comprises bank and non-bank financial institutions which are regulated by the Federal Ministry of Finance (FMF), Central Bank of Nigeria (CBN), Nigeria Deposit Insurance Corporation (NDIC), Securities and Exchange Commission (SEC), National Insurance Commission (NIC), Federal Mortgage Bank of Nigeria (FMBN), and the National Board for Community Banks (NBCB).
THE FEDERAL MINISTRY OF FINANCE (FMF)
The Federal Ministry of Finance advises the Federal Government on its fiscal operation and co-operates with CBN in monetary matter. Recent amendment to the laws of the Central Bank of Nigeria compels it to report through the Federal Ministry of Finance to the Presidency
THE CENTRAL BANK OF NIGERIA (CBN)
The CBN is the apex regulatory authority of the financial system. It was established by the Central Bank of Nigeria Act of 1958 and commenced operations on 1st July 1959. Among its primary functions, the Bank promotes monetary stability and a sound financial system, and acts banker and financial advisor to the Federal Government, as well as banker of last resort to the banks. The Bank also encourages the growth and development of financial institutions. Enabling laws made in 1991, gave the Bank more
flexibility in regulating and overseeing the banking sector and licensing finance companies which hitherto operated outside any regulatory framework.
THE NIGERIAN DEPOSIT INSURANCE CORPORATION (NDIC)
The NDIC compliments the regulatory and supervisory role of the CBN. It is however autonomous of the CBN and reports to Federal Ministry of Finance. The NDIC effectively took off in 1989 and was set up to provide deposit insurance and related services for banks in order to promote confidence in the banking industry. The NDIC is empowered to examine the books and affairs of insured banks and other deposit-taking financial institutions. Licensed banks are mandated to pay 15/16 of 1% of their total deposit liabilities as insurance premium to the NDIC. A depositor's claim is limited to maximum of N50000.00 in the event of a bank failure
THE FEDERAL MORTGAGE BANK OF NIGERIA (FMBN)
The FMBN took over the assets and liabilities of the Nigerian Building Society. The FMBN provides banking and advisory services, and undertakes research activities pertaining to housing. Following the adoption of the National Housing Policy in 1990, The FMBN is empowered to licence and regulate primary mortgage institutions in Nigeria and act as the apex regulatory body for the mortgage finance industry. The financing function of the Federal Mortgage Bank of Nigeria was carved out and transferred to the Federal Mortgage Finance, while the FMBN retains its regulatory role. The FMBN is under the control of the Central Bank.
FINANCIAL SERVICES CO-ORDINATING COMMITTEE (FSCC)
This is a committee established to co-ordinate the activities of all regulatory institutions in the financial system. The Committee is chaired by the Federal Minister of Finance.