The Central Bank of Nigeria (CBN) has created a new Compliance Department to strengthen regulatory efficiency and improve supervision across the financial sector. This move highlights the apex bank’s determination to tighten control and respond to rising risks.
According to a circular signed by Olubunmi Ayodele-Oni, the department began operations in the first quarter of 2025. It became fully operational in the second quarter after completing structural and staffing processes.
Furthermore, the establishment forms part of broader institutional reforms introduced by the CBN. These reforms aim to consolidate oversight functions, reduce overlaps in responsibility, and ensure a sharper focus on non-prudential and emerging risks that threaten stability.
Guidance for Financial Institutions
In the circular, the CBN directed all regulated financial institutions to channel compliance-related reports, inquiries, and correspondence directly to the Director of the new department. This directive covers risk monitoring, regulatory reviews, and other supervisory matters.
In addition, the bank explained that further guidance will follow. Each institution will receive details on points of contact, reporting templates, and submission procedures to guarantee a smooth workflow.
“The Compliance Department will embed discipline in regulation and deliver stronger oversight of non-prudential risks,” the circular emphasized.
Strengthening Regulatory Collaboration
The CBN assured stakeholders that the reform will not disrupt operations. On the contrary, it will create a coordinated framework where regulators and financial institutions can work more closely. Moreover, the bank pledged to provide continuous support and maintain high standards of compliance.
Analysts believe this step could help restore confidence in Nigeria’s financial system. By creating a dedicated compliance unit, the CBN aims to address weaknesses that previously allowed irregularities and poor reporting practices to go unchecked.
Concerns Over Rising Financial Fraud
Significantly, this reform follows the CBN’s warning in July about the rapid increase in financial fraud across Nigeria. The apex bank reported that fraud cases grew by 45% in just one year. Even more concerning, 70% of the recorded losses came from digital platforms, including unregulated virtual asset channels.
CBN Governor Olayemi Cardoso, represented by Deputy Governor for Economic Policy, Muhammad Sani Abdullahi, disclosed these figures at a public lecture hosted by the Economic and Financial Crimes Commission (EFCC).
The Governor noted that findings in the Financial Stability Report 2024 confirmed a sharp rise in fraudulent activity. He stressed that while digital finance expands inclusion, it also introduces complex risks that regulators must urgently address.
Outlook
With the Compliance Department in place, the CBN is now better positioned to act faster against regulatory breaches. The department will play a central role in monitoring risks, guiding institutions, and ensuring Nigeria’s financial sector consistently meets global compliance standards.
