When Dr. Yemi Cardoso, assumed office as the substantive Central Bank of Nigeria (CBN) Governor on Thursday, October 05, 2023, following his confirmation, discerning minds who wanted a retooling at the CBN called for the resetting of the CBN to its core mandates. He was previously appointed in an acting capacity on Thursday, September 21, 2023.
Experts had even before his appointment expressed deep concerns over the veering off by the CBN into heterodox (unconventional) monetary policies saying it caused significant distortion to the CBN mandate. They also said it hurt the economy more than it added value.
The reformed-minded Governor was appointed alongside a crack team of technocrats and subject matter experts in the Committee of Governors. They include: Bala Bello, MON, the workaholic 
Deputy Governor, Corporate Services Directorate, Muhammad Sani Abdullahi
Deputy Governor, Economic Policy Directorate, Philip Ikeazor
Deputy Governor, Financial System Stability Directorate, and Emem Usoro, the Deputy Governor, Operations Directorate.
The team would go into deep study of the financials of the CBN, the activities of the CBN as it applied to its core mandates especially bordering on being an advisor to the government, reviewing monetary policy tools, fighting inflation, managing the value of the naira and more.
What followed was about two months of grueling investigations, interrogations of processes, review of policies, staff audit for efficiency, proper placements of staff for optimum efficiency, and dealing with endemic systemic corruption that would thwart impending reforms at the apex bank.
It will be at the Chartered Institute of Bankers of Nigeria (CIBN) 58th Annual Bankers’ Dinner and Grand Finale of the Institute’s 60th Anniversary November 24, 2023, that Dr. Cardo will make a far-reaching public statement on the new direction at the CBN.
At the event, the CBN Governor told the audience that the CBN will return to its core statutory mandate; which is to ensure price stability, in addition to issuing legal tender, safeguarding external reserves, promoting a sound financial system, and providing economic and financial advice to the government.
The CBN Governor believes that “through targeted policies, transparent market operations, and coordination between monetary and fiscal authorities” the apex bank “can ensure a more stable exchange rate, control inflation, and create an enabling environment for businesses and individuals to thrive.”
Indeed this is what the new helmsmen at the CBN have kept a watch on in about five months in the office and counting.
The cleansing by the CBN partly is based on findings by the Special Investigator of the Central Bank of Nigeria (CBN) and other related entities.
Recall President Bola Tinubu had appointed Mr. Jim Obazee, the former Chief Executive Officer of the Financial Reporting Council of Nigeria (FRC), on July 28, 2023 to investigate activities of the CBN during President Mohammadu Buhari’s tenure. The committee on April 5th submitted its final report to the president.
Snippets of the report released by the investor revealed that the CBN under Mr. Godwin Emefiele, the CBN Governor, consented to the “unlawful removal” of about $6.23 million from the vault of the apex bank’s Abuja office.
The panel said the tenue also witnessed indiscriminate and “fraudulent” use of ways and means advances by the CBN amounting to over N22trn exacerbating inflation to record highs.
There are several other findings of alleged corruption perpetrated in the apex bank before Cardoso came on board.
The CBN is already being cleansed and repositioned to contribute to economic growth by the new team.
“I am aware that events over the past few years have also put the CBN in a bad light. These issues can be attributed to various factors, such as corporate governance failures, diminished institutional autonomy of the Central Bank of Nigeria, a deviation from the core mandate of the Bank, unorthodox use of monetary tools, an inefficient and opaque foreign exchange market that hindered clear access, a foray into fiscal activities under the cover of development finance activities. There was also a lack of clarity in the relationship between fiscal and monetary policies, among other challenges” Dr. Cardoso recounted.
Thus, the deep reforms commenced in all of the above areas and more.
Some of the reforms that have happened include; discontinuation of intervention funds which the CBN hitherto expended over N10trn without measurable outcomes, liberalism of the Forex market, lifting of forex restrictions on 43 items, and recapitalisation of the banking sector.
Other policies include; reforming the Bureau De Change operations which had constituted an albatross to naira stability. They had also been fingered in some quarters for terrorism financing, and money laundering. They were used as a veritable platform for arbitrage perpetrated by some commercial bank staff and even some CBN staff. This was low for a regulatory authority that should punish market abuse and not be an active player in economic sabotage.
Cardoso needed to end the merry and he did so decisively despite some pushback.
The reform in that FX Market segment saw a cleaning up of the BDC with 4,173 licenses revoked. This has restored sanity at the parallel market and the naira is the better for it. The naira has regained over N600/$1 and counting in less than two months.
Cardoso and his team would continue with the reforms by transferring some core staff of the apex bank to drive the announced recapitalisation and effective banking supervision to Lagos. On the 26th March 2024, indeed the CBN announced a new minimum capital base for banks.
The new minimum capital requirement for commercial banks with international authentication was raised to N500bn, national authorisation is now N200bn, and regional authorisation is N50 billion. For merchant banks, it is now N50bn while the new requirements for non-interest banks with national and regional authorisation are now N20bn and N10bn respectively.
With the new prescription, the CBN is hoping to attract new capital into the country, make the banks stronger to add value to the economy, and help drive the President’s ambitious goal of achieving a Gross Domestic Product (GDP) of $1.0 trillion over the next seven years.
In addition, the CBN management began a human resource repositioning programme for efficiency.
Some staff who have been found to have compromised standards are being disengaged.
Some have been alleged to be standing in the way of the recent policies and impeding progress thus, for the policies to crystallise, the CBN needs staff who will key into the long-term policy of the apex bank. This exercise is ongoing and has been greeted with resistance in some quarters.
The CBN Governor said under his leadership, the Central Bank of Nigeria will vigorously address the above issues and more.
“We will tackle institutional deficiencies, restore corporate governance, strengthen regulations, and implement prudent policies. We assure investors and the business community that the economy will experience significant stability in the short-to-medium term as we recalibrate our policy toolkits and implement far-reaching measures” he assured.
Industry watchers have also advocated for reforms in the CBN especially, reforms concerning corporate governance.
They’ve tasked the management to address with dispatch the institutional deficiencies at the CBN, restore sound corporate governance, strengthen regulations, and prevent corruption.
A top management staff of the apex bank who spoke on condition of anonymity said it’s “time to get all the bad eggs and accomplices out of the CBN for recent policies to succeed.”
“We can’t make significant progress without weeding out the bad eggs. There was so much looting in the bank. Some staff have become so vested they won’t want our reforms to work” he said.
Contrary to insinuations in some quarters that the Cardoso-led team is witch-hunting the affected staff, he said it’s far from reality. “We are only retooling our internal corporate governance processes so the CBN could work better,” he said adding that the “CBN needs to breathe.”
He said the cleaning wouldn’t be a one-off affair but would be done annually until the CBN is purged off staff that are not in sync with the new CBN.
Again, recall just recently the Former SGF Boss confirmed in court that “neither Buhari nor FEC approved any payment to foreign election observers.
Another source at the apex bank who pleaded anonymity said “Those who aided and abetted the malfeasance and stealing of our collective patrimony at the CBN must not only be punished but prosecuted and jailed “
“One of the charges against Emefiele is the withdrawal of $6.2 million in cash shortly before the 2023 elections by forging Buhari’s signature, the staff involved in abetting this heist have already confessed and returned about $1 million to the CBN” he stated.
Continuing he said “This may not be the only one. All those staff that aided and abetted Mr. Emefiele, who is currently standing trial, in all these alleged stealing must not only be dismissed but also be prosecuted. Indeed, CBN was a cesspool of corruption under the last administration as mentioned by President Tinubu in his Independence Day speech.”
He indicated that there was recruitment fraud, promotion fraud, medical fraud, and massive kickbacks collected from Anchor Borrowers and other intervention schemes.
According to him, “Cardoso and his team must restore the lost glory of the CBN that until recently was suffering from trust deficit.”
Commenting on the reforms, a financial analyst, David Aku said the reforms are positive and should be encouraged by people who want the CBN to help reform the economy.
He said the economy has suffered significant stress from inflation, naira instability, and policy distortions.
He would add that the lack of clear-cut distinctions between fiscal and policy under the last CBN leadership also worried the industry.
“The CBN is an important institution and the staff will have to be very professional and exhibit integrity in handling affairs. So if some staff are of questionable character, they should be weeded out of the system. However, to reduce the legal issues because I understand some staff have gone to court, some of the staff should be paid off rather than sack them without benefits” he said.
He also called on President Bola Ahmed Tinubu to support the CBN reforms and not yield to the blackmail Cardoso is currently experiencing.
“The reforms are not popular, but they have to be supported to succeed and instill discipline into the CBN” he stated.
A Civil Society Organisation (CSO), Save Nigeria Movement (SNM), recently expressed support to the CBN Governor, over the ongoing effort to reposition the economy of the country and the CBN.
Convener of the CSO, Rev Solomon Semaka, addressing a press conference in Abuja called on Nigerians to be patient with the team put together by the CBN Governor to right the wrongs of the past in line with the renewed hope agenda of President Bola Ahmed Tinubu-led administration
