The Central Bank of Nigeria (CBN) has placed terrorism financing risk at the top of its supervisory agenda, marking a significant shift in how the apex bank plans to monitor and regulate financial institutions across the country. In a statement signed by Hakama Sidi-Ali, acting director of the Corporate Communications and Investor Relations Department, on Tuesday, the CBN said enhanced scrutiny would be applied to terrorism financing risk management, transaction monitoring, the implementation of targeted financial sanctions, and the reporting of suspicious transactions connected to terrorism financing.
Risk-Based Supervisory Approach
The bank said it would continue to use a risk-based approach to check that financial institutions are complying with anti-money laundering (AML) and counter-terrorism financing (CFT) rules. This will involve both on-site visits and off-site assessments to measure how effective controls are across the sector, in line with existing legal obligations.
The CBN said in the statement: "The Central Bank of Nigeria has elevated terrorism financing supervision to a current supervisory priority, as part of its ongoing commitment to protecting the Nigerian financial system from abuse by illicit actors."
Strengthening Financial Integrity
The bank added: "The Bank will continue to apply a risk-based supervisory approach, including on-site and off-site engagement, to support effective AML/CFT/CPF controls across the financial sector in line with existing legal and regulatory obligations."
The CBN noted that the supervisory focus also supports Nigeria's cooperation with domestic and international partners on counter-terrorism financing, counter-proliferation financing, and broader financial integrity goals. Where necessary, the bank said further supervisory engagements would follow as it works to strengthen protections around the financial system.
Pressure on Nigerian Financial Institutions
The announcement comes as Nigerian financial regulators and institutions face growing pressure to ensure the country's banking system cannot be used to move or conceal funds tied to terrorism or other criminal activities, as reported by BusinessDay. The CBN framed the decision as part of a broader effort to build the resilience of Nigeria's financial system against money laundering, terrorism financing, and proliferation financing risks.
The bank stated: "This supervisory focus also supports Nigeria's ongoing domestic and international cooperation on counter-terrorism financing, counter-proliferation financing, financial integrity, and the protection of the financial system."
In a related development, Legit.ng earlier reported that Bank78 MFB officially commenced operations as a private digital lender in Nigeria. The bank said that while its model is inspired by private banking culture and principles, it is deliberately designed to serve mass-affluent Nigerians seeking a secure and premium digital banking experience. In a statement announcing the commencement of operations, Bank78 MFB said it aims to bridge the gap between fast-growing fintech companies and traditional legacy banks.
