EFCC warns banks against unsecured loans

The Economic and Financial Crimes Commission (EFCC) has warned Nigerian banks to desist from granting loans without credible collateral, citing concerns implicit insider maltreatment and threats to fiscal stability.

The commission’s chairman, Ola Olukoyede, gave the informing during a courtesy sojourn by officials of First Bank of Nigeria Plc to the Lagos Zonal Directorate 2 bureau successful Ikoyi.

Speaking done the acting Zonal Director, Assistant Commander Bawa Usman Kaltungo, Olukoyede expressed interest implicit lending practices successful the banking sector, peculiarly loans backed lone by idiosyncratic guarantees, which helium said exposure depositors’ funds to important risk.

“We person issues with banks’ mode of giving loans. The process often shows insider abuse,” helium stated.

He criticised the signifier of “top-down loans”, noting that they deficiency due information and should beryllium discouraged.

“You cannot springiness a indebtedness based solely connected the idiosyncratic warrant of the Chief Executive. This is not security. Banks indispensable not contented loans without verifiable collateral,” helium said.

Olukoyede maintained that enforcing strict collateral r...