The Central Bank of Nigeria (CBN) has announced that it will impose sanctions on banks found to be assisting unlicensed foreign firms operating in Nigeria.

The announcement was made in the “Guidelines for the regulation of representative offices of foreign banks in Nigeria” released on Monday and signed by the Director of the Financial Policy and Regulation Department, Muhammad Musa.

The guidelines highlight that representative offices of foreign banks play an important role in showcasing the brand and services of their parent company, and can help to stimulate foreign direct investment.

The CBN’s guidelines specify the requirements for the licensing and operation of approved representative offices of foreign banks in Nigeria.

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Any CBN-regulated entity found to be supporting, assisting, harbouring or facilitating the presence and/or operations of an unlicensed foreign financial institution will be subject to severe sanctions, including suspension or revocation of their banking licence.

The guidelines apply to banks licensed under foreign law, financial institutions licensed under foreign law whose primary business includes receiving deposits, granting loans, and providing current and savings accounts, and foreign-owned operating banks/financial holding companies that own controlling interests in one or more banks or institutions with a primary business in the above areas.