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January 2018 MPC Meeting: Caught Between Two Arms

Proshare

Friday, January 19, 2018 2.35PM/ Proshare Research 

The Central Bank of Nigeria was established through the 1958 act, over the years such act has experienced series of amendment so as to be in tandem with the evolving financial land scape. Presently the bank is adjudged on the 2007 act, which clearly specifies the banks mandate to ensure growth and price stability. 
 

In addition, administration of the bank is carried out by the governor and four deputy governors. The act stipulates that decision that go beyond administrative activity of the bank but bore on policy choice should be determined by the monetary policy committee (MPC).  
 

The composition of the board is made up of 12 members with the Governor as the chairman of the board. At the same time the act states that the board must meet at-least six times in a year.  Members of the board are appointed by the President, such appointment is ratified by the senate. In an attempt to ensure the legal perquisite was met as the Central Bank scheduled the meeting in line with the required number in the 2018 year.   
 

  •  22-23 January, 2018

  •  19-20 March, 2018

  •  20-21 May, 2018

  • 23-24 July, 2018

  • 24-25 September, 2018

  • 20-21 November, 2018 

In recent times the board has experienced depletion due to most members reaching their retirement age. Presently, there are only 3 members left on the board, which are the Central Bank Governor and 2 other member. 

Fig1; Present members of the monetary policy Committee (MPC)

MPC Member

Status

Godwin Emefele

Chairman

Stanley l Lawson

Member

Daniel  Anatasia 

 Member

Source: Online Media 

Thereby the numbers on the board fall short to form a quorum. The president had appointed certain individuals to avert the on-going fiasco.  

 

Fig 2: Recently Nominated Members

Appointed member

Status

Date  Appointed

Mrs Hadiza Ahmad

Deputy Governor, member

4 October 2017

Adeola  Adenikiniji

MPC Member

4 Oct0ber 2017

Aliyu Sanusi

MPC Member

4 October 2017

Robert  Asogwa

MPC Member

4 October 2017

Asheikh Maidugu

Non-executive

MPC Member

4 October 2017

Prof Obadan

Non-executive                MPC member

26 April 2017

Dr Abubakar

Non-executive

MPC member

26 April 2017

Prof Odiwachukwu

Non-executive

MPC member

26 April 2017

Source: Online Media 

On the legislative aisle, the upper chamber has maintained that unless the present head of the economic financial crimes and commission is sacked. The legislature will not give assent to the appointment of the executive, thus putting the monetary policy committee board in a position of imbroglio.    
 

However, the inability to meet as scheduled put the board under pressure in the next meeting. New members will have to quickly settle down, given the desperation for policy response to reduce implementation lags. Moreover, the bank will have to provide needed guidance to the market ranging from goal objective to numerical target, which should have been done in the first meeting.
 

Proshare Nigeria Pvt. Ltd.

Proshare Nigeria Pvt. Ltd.

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