Nigeria mulls Islamic banking

The Central Bank of Nigeria (CBN) has promised to address its risk management challenges through a macro-prudential surveillance framework, reports The Moment.

CBN deputy governor, financial system stability, Dr Kingsley Moghalu, says CBN would priorities data integrity and strengthen its crisis management and resolution capability.

“In addition, regulatory cooperation will be enhanced in surveillance and in capacity-building for effective cross border supervision,” he adds.

AFP says plans to introduce Islamic banking as one of the models of non-interest financial services has caused controversy in religiously divided Nigeria.

CBN published a final set of regulations on non-interest banking, which includes Islamic banking, and cleared in principle two banks to offer the product.

The bank says the introduction of Islamic banking is part of its drive to propel Nigeria's economy and promote financial inclusion by introducing alternative products.

The Nigerian unit of South African Standard Bank has won approval to set up an Islamic banking arm, reveals Reuters Africa.

CBN governor Lamido Sanusi says he wants to establish Nigeria as the African hub for Islamic banking and is working on a regulatory framework to emulate the success of the industry in Malaysia.

He says Stanbic IBTC Bank has six months to comply with the approval terms. CBN claims it's looking at Islamic finance as a way of diversifying the country's financial system and planning to issue the first sovereign sukuk within the next 18 months.