Individuals, group of individuals,
community development associations, private corporation entities or foreign
investors, can establish M F B S. Significant ownership diver signification shall
be encouraged to enhance good corporate
government of licensed M F B S.
No individuals group of individuals
their provides corporate entities and or their subsidiaries shall establish
more than one MFBS linder a different or disguised name.
Section 6 of the frame work deals with
measure and instruments for establishment of micro finance bank (MFBS).
The
guideline provided for the establishment of two categories of micro finance
banks. MFBS namely.
(a) Micro finance bank licensed to
corporate as a unit bank within a local government area with a minimum paid-up
capital/share holder’s fund of N20 million
(b) Micro finance bank licensed to
corporate in a state with a minimum paidup capital/share holders fund of N
million.
Section 7 of the guideline outline
organic path for the MFBS A unit micro finance bank shall be allowed to extent
its ranch network to other local government areas in the state thereby
transforming to state bank, provided it covers at least two. Third of the local
government areas of the state and subject to prescribed prudential requirement
and availability of minimum capital fund of N20 million for each branch
similarly a state micro finance bank can organically grow into a National bank
by establishing branches in other state, provided that it opens branches in at
least two of the local government areas of the state of its current operation
and meet the presibed prudential requirements including N20 million paid-up
capital shareholders funds for each branch. A micro finance bank however may
wish to start operations as a state bank from the beginning without organically
growing from a unit bank, subject to the provision of N1 million capital base
(CBN 2005).
Section 8 of the guideline provides that
a micro bank can be established by individual group of individuals,communities
development association, private corporate bodies or individuals or groups
shall not establish more than one micro finance bank order a different or
disused name .
Section 9 provides for partienation of existing
financial in institution in micro finance activities. Universal banks currently
engaging in micro finance operation shall be required to either set up a
subsidiary for that purpose, or a department for subject to the provision of
the M F B S
REGULATORY
AND SUPERVISORY GUIDELINES
Section
9.2 of the guidelines provides that all existing licensed community bank shall
transform to unit micro finance bans on meeting the N20 million minimum capital
and other conversion requirement within a period of 24 months from the date of
approval of this guideline (Dec 2005).
Any
community bank able to meat the specifics capital requirement of N1million can
apply for licensed to operate as a state MFB.