Central Bank of Nigeria aims to be proactive in providing a stable framework for the economic development of Nigeria through the effective, efficient and transparent implementation of monetary and exchange rate policy and management of the financial sector.
The statutory mandates of the CBN are as follows:
- To issue legal tender currency
- To maintain external reserves
- To safeguard the international value of the legal tender currency
- To promote monetary stability and a sound financial system in Nigeria
- To act as banker and financial adviser to the Federal Government.
The Monetary Policy in Nigeria is best understood from the stance of the mandate set for the Bank, which includes:
- Maintenance of Nigeria’s external reserves to safeguard the international value of the legal currency.
- Promotion and maintenance of monetary stability and a sound and efficient financial system in Nigeria.
- Acting as banker and financial adviser to the Federal Government; and
- Acting as lender of last resort to banks.
Consequently, the Bank is charged with the responsibility of administering the Banks and Other Financial Institutions (BOFI) Act (1991) as amended, with the sole aim of ensuring high standards of banking practice and financial stability through its surveillance activities, as well as the promotion of an efficient payment system.
In addition to its core functions, CBN has over the years performed some major developmental functions, focused on all the key sectors of the Nigerian economy (financial, agricultural and industrial sectors). Overall, these mandates are carried out by the Bank through its various departments.