The House of Representatives on Thursday took a major step toward overhauling the Central Bank of Nigeria (CBN) Act, beginning legislative work on a reform bill aimed at strengthening transparency, governance, and regulatory oversight at the apex bank.
The bill, sponsored by House Leader Julius Ihonvbere and Jesse Onakalausi (Lagos), passed second reading without resistance during plenary, reflecting broad support for what lawmakers described as a long-overdue restructuring of the CBN’s operational framework.
Officially titled “A Bill for an Act to Amend the Central Bank of Nigeria Act, 1991… and for Other Matters Connected Thereto, 2025,” the proposal is a response to mounting concerns over lapses in governance, monetary policy inconsistencies, and controversies surrounding Nigeria’s foreign exchange management and the 2022 currency redesign.
Leading debate, Onakalausi said recent economic events had exposed “structural gaps” in the existing Act, making comprehensive reform unavoidable.
“The CBN plays a central role in stabilising the financial system, ensuring monetary credibility, safeguarding price stability, and promoting public confidence in the Nigerian economy,” he said. He identified governance lapses, FX distortions, poor policy communication and weak oversight as key issues the bill seeks to correct.
Separation of Powers at the CBN
A major highlight of the amendment is the separation of the positions of CBN Governor and Chairman of the Board, roles currently held by one person.
Onakalausi said combining both roles creates “an avoidable concentration of power,” noting that most global central banks separate these positions to avoid conflict of interest and ensure effective oversight.
He explained that the proposed separation will allow the governor to focus on day-to-day operations, while a professional board chairman provides institutional checks and balances.
Stronger Monetary Policy Framework
The bill also proposes reforms to strengthen the Monetary Policy Committee (MPC) and align Nigeria’s monetary governance with practices in the UK, South Africa, Brazil and the European Union.
Under the proposal, the reconstituted MPC will include the governor, four deputy governors, two board members and four independent external experts who cannot hold public office, ensuring objectivity and technical depth in monetary decisions.
Tightening Ways and Means Financing
Another major provision seeks to curb the historical abuse of the CBN’s ways and means advances to the Federal Government.
The bill introduces a strict limit: 10% of the previous year’s actual revenue, aimed at preventing inflationary borrowing and reinforcing fiscal discipline.
Read also:
- CBN approves 82 BDCs nationwide, warns against patronising illegal forex dealers
- CAC sets January deadline as crackdown on unregistered PoS operators begins nationwide
- Cardoso: Nigeria doesn’t need to beg investors when economic fundamentals are strong
Safeguarding the Naira and Ensuring Policy Stability
To prevent sudden and disruptive policy changes, such as the controversial 2022 currency redesign, the bill mandates:
A 90-day notice before major monetary actions
Impact assessments and National Assembly briefings
Greater supervision of FX management and transparency in currency processes
These measures, lawmakers said, will protect citizens and businesses from abrupt monetary shocks.
New Reporting and Transparency Standards
To deepen accountability, the bill requires the CBN to:
Submit audited financial statements within two months
Provide quarterly reports on monetary decisions
Maintain a publicly accessible website with all publications
Adopt clearer disclosure standards for FX operations, interventions and reserves
Six-Year Single Term for Governor and Deputies
The bill amends Section 8 to provide a single six-year term for the CBN Governor and Deputy Governors, reducing political interference and encouraging long-term policy planning. It also requires that at least two Deputy Governors be appointed from within the institution’s directorate to promote continuity.
If passed, the bill will represent one of the most far-reaching reforms of the CBN Act since 1991, with sweeping implications for monetary policy, corporate governance, and Nigeria’s financial stability.
