CBN issues directive to banks
The Central Bank of Nigeria has directed all Domestic Systemically Important Banks to make public the appointment of a new Managing Director or Chief Executive Officer at least three months before the exit of the current one.
The apex bank explained that this measure is to allow for smooth transitions in leadership and prevent sudden disruptions in the management of top financial institutions.
It also ordered that regulatory approval for the appointment of a successor must be secured no later than six months before the end of the incumbent’s tenure.
The directive was issued through a circular signed by the Director of the Financial Policy and Regulation Department, Rita I. Sike.
It referenced Section 2.14 of the CBN corporate governance guidelines for banks, which requires boards to have succession plans for MDs, executive directors, and senior management.
According to the circular, the rule is necessary because systemically important banks play a vital role in maintaining financial stability.
The CBN stressed that succession planning must follow sound corporate governance practices and directed banks to strictly comply with the new order.
