Bank directors with non-performing loans (NPLs) are to quit or be sacked, according to a new Code of Corporate Governance approved by the Central Bank of Nigeria (CBN).
Director, Bank Examination Department at the Nigeria Deposit Insurance Corporation (NDIC), Adedapo Adeleke, said the new code was instituted to address the rising cases of insider bad loans, which not only represent a conflict of interest, but are against the prudential guidelines for the industry.
He described corporate governance as an essential pillar in financial system stability.
Banks’ assets have depreciated in the last three years, with provisions for NPLs hitting N856.9 billion, due to the drop in crude oil prices. A large part of these bad loans is owed by bank directors and are in most cases unsecured.
Bank directors with bad loans to go
