The Central Bank of Nigeria (CBN)
Central Bank of Nigeria is the apex regulatory or supervisory body of financial institutions in Nigeria. The central bank is responsible for issuing credit, government issues treasury bill,s and monetary guidelines for the economy. Central bank is a regulatory body for the money market
Functions of the Central Bank
1. The Central bank has the Sole authority to issue currencies.
2. It serves as a banker and acts as an agent to the government, they keep all accounts of the government and act the role of a custodian to the government.
3. The central bank acts as a banker to the commercial banks, it helps the banks to facilitate interbank transactions. Other banks keep part of their deposit with the central bank and withdraw from it when their liquidity runs down.
4. They assist commercial banks in the country, the commercial bank turns to the central bank as a last resort, when they are short of cash they borrow from the central bank.
5. The central bank is charged with the responsibility of maintaining external reserves in order to safeguard the international value of the currency.
6. The central bank has the responsibility of promoting monetary stability. They use various instruments of monetary policy to control commercial banks.
7. The central bank controls credit for the commercial bank in order to monitor and control deflation and inflation in the country.