CBN Strengthens Oversight of Terrorism Financing Risks

The Central Bank of Nigeria (CBN) has elevated terrorism financing (TF) to a key area of supervisory attention as part of efforts to prevent the country’s financial system from being exploited for illicit activities.

The apex bank disclosed the development in a statement signed by Hakama Sidi-Ali, Acting Director of the Corporate Communications and Investor Relations Department.

Under the enhanced supervisory framework, the CBN said it would intensify its assessment of financial institutions’ ability to identify, manage and mitigate terrorism financing risks.

Particular attention will be given to institutions’ risk management frameworks, transaction-monitoring systems, implementation of targeted financial sanctions and procedures for identifying and reporting suspicious transactions associated with terrorism financing.

The CBN said its supervisory activities would continue to follow a risk-based approach, combining on-site examinations with off-site monitoring to assess the effectiveness of anti-money laundering, counter-financing of terrorism and counter-proliferation financing (AML/CFT/CPF) controls across the financial sector.

According to the bank, the enhanced oversight will be conducted in line with existing legal and regulatory requirements.

The CBN also linked the initiative to Nigeria’s broader domestic and international commitments to combating terrorism financing and proliferation financing, while strengthening the integrity and resilience of the financial system.

“Further supervisory engagement will be undertaken as appropriate,” the bank said.

The latest move underscores the CBN’s continued efforts to ensure that financial institutions maintain effective safeguards against illicit financial flows and strengthen their compliance with Nigeria’s AML/CFT/CPF framework.

By placing greater supervisory emphasis on terrorism financing, the central bank is signalling that regulated institutions will face closer scrutiny over the effectiveness of their controls, monitoring systems and reporting mechanisms for detecting and preventing financial activity linked to terrorism.