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68 J.L. Pol'y & Globalization 1 (2017)

handle is hein.journals/jawpglob68 and id is 1 raw text is: ISSN 2224-3240 (Paper) ISSN 2224-3259 (Online) Vol.68, 2017 HE An Examination of Laws Regulating Banking in Nigeria: Review of the Banks and other Financial Institutions Act, 2007 Baba Isa Sanda Benisheikh' Yahaya Alhaji Dunoma2 Musa Alkali Lawan3 1.Lecturer, Department of Private Law, Faculty of Law, University of Maiduguri 2.Lecturer, Department of Languages and Liberal Studies, Ramat Polytechnic, Maiduguri 3.Lecturer, Department of Civil Law, Mohammed Goni College of Legal & Islamic Studies, Maiduguri Abstract Banking business is one of the fastest growing sectors of the Nigerian economy which requires a fundamental framework that will enhance the business and to regulate its operations to meet the challenging aspect of the sector. The coming into force of the revised Banks and Other Financial Institutions Act in the year 2007 has sent a signal to all players of the sector that banking business must be in conformity with the relevant laws and therefore no bank in Nigeria will start business without recourse to the Act which is the enabling law of the sector. Things like license and others must be properly checked before operation. The Central Bank of Nigeria being the Apex bank in the country has a role to play in terms of granting license to all proposed banks before start of business. The Act has given the Bank the powers to supervise and monitor the activities of banks in Nigeria, be it commercial, merchant, agricultural, development, infrastructural or micro finance bank. 1. Introduction The Nigerian banking industry is the backbone of Nigeria's economy in this 21st century. It is the most vibrant, reliable and effective sector of the Nation's economy after the petroleum industry. Hence, it requires constant and proper supervision in terms of granting of license and operations. Customers who made deposits must know that their monies are in safe hands. The Central Bank of Nigeria Act,1 the Banks and Other Financial Institutions Act,2 more particularly the Nigeria Deposit Insurance Corporation Act,3 being the institution charged with the responsibility of insuring all deposits made in Nigeria by depositors in all the licensed banks and other financial institutions in Nigeria' and other laws that are put in place to safeguard the deposits made by depositors in the Nigerian banks and to further strengthen the operational framework of Nigerian banks. The combine effect of these laws have made the banking business in Nigeria more stable compared to some years back when deposits were made with fear and doubt of whether depositors will meet their deposits the next day. The examination of the banking industry in Nigeria will be done taking into cognizance the relevant laws regulating the industry and the measures put in place to avert economic meltdown and recession that will require a bail-out which occurred in Greece, Italy, Spain and other parts of Europe. The length and breadth of the 2007 Act will be examine thoroughly in terms of establishment, granting of license to banks, operations, nature of business, capital ratio, duties, opening, maintaining and closing of bank accounts, supervisions by the apex Bank and other general and incidental matters connected therewith. 2. Evolution of Banks in Nigeria Modem banking business started in Nigeria when the African Banking Corporation through the instrumentality of Messrs. Elder Dempster Company was established in the year 1892.' Later in the year 1893, the British Bank of West Africa was formed to carry on banking activities with 10,000 Pound Sterling capital,6 thus this marked the genesis of banking business in Nigeria.7 And later, in the year 1899, the Anglo-African Bank was established in the Old Calabar by the Royal Niger Company (now United African Company, UAC) to compete with the British Bank of West Africa' and that was followed by the formation of Barclays Bank DCO (now the Union Bank of Nigeria Plc) in 1917 and the British and French Bank (now called the United Bank for Africa Plc, UBA) in 1949.9 3. What is a Bank, Banking Business or a Banker? The definition of the term bank, banker or banking business has been regarded as synonymous by many including Statutes. In whichever way defined, the terms meant the same because they are aimed at the same 'Central Bank of Nigeria, Act No. 7, 2007. 2 Banks and Other Financial Institution Act, Cap. B3, Revised Edition, (Laws of the Federation of Nigeria), 2007. Nigerian Deposit Insurance Corporation, Act, 2006. 4 Section 2 (1) (a) of the Nigerian Deposit Insurance Corporation, Act, 2006. 5Adeniji, 0. A., Law Relating to Banking, (F & A Publishers Ltd, Lagos, 1984), Pg. 1. 6Adekanye, E, The Elements ofBanking in Nigeria, (Graham Burn, Bedfordshire, 1984), Pg. 81. Watila, I., & Cyril, C., Law and Ethics ofBanking in Nigeria, (Madika Publishing Company, Maiduguri, 2011), Pg. 1. 8Adekanye, E, Op. Cit. Pg. 81. IIbid. 1 Journal of Law, Policy and Globalization 11M iLste0r~g

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