Founding and mandate
The Central Bank of Nigeria (CBN) was established by the Central Bank of Nigeria Act 1958, following recommendations of an earlier 1952 banking inquiry (the G.D. Paton Report) that had already produced Nigeria's first Banking Ordinance, and it commenced full operations on 1 July 1959, two years before independence S1. Its first Governor was Roy Pentelow Fenton, a British economist appointed by the colonial administration, who served until 1963 and was credited with setting up Nigeria's early foreign-exchange system and currency arrangements before handing over to Aliyu Mai-Bornu, the first Nigerian to hold the post S1. The Bank's early institution-building included introducing treasury bills in 1960 and supporting the creation of the Lagos Stock Exchange in 1961 S1. Today the CBN operates under the CBN Act 2007, which the Bank itself describes as its current governing framework and which cemented full operational autonomy after amendments in 1991 and 1997–1998 had progressively expanded and then restored its independence from direct government control; its stated statutory purpose is "promoting stability and continuity in economic management," including ensuring monetary and price stability and advising the federal government on economic policy S1
Structure and monetary policy tools
Monetary policy decisions are made by the Monetary Policy Committee (MPC), which meets roughly every two months and sets the Monetary Policy Rate (MPR) — the benchmark interest rate — along with the Cash Reserve Ratio (CRR) for deposit money banks and merchant banks and the standing facilities corridor that bounds overnight lending and deposit rates S2. Published minutes of recent meetings show the Committee moving in relatively small, deliberate steps: after holding the MPR at 27.0% through late 2025, the MPC cut it by 50 basis points to 26.5% at its 304th meeting on 23–24 February 2026, then held that rate at its 305th meeting (19–20 May 2026) and again at its 306th meeting (20–21 July 2026), citing the desire to consolidate an ongoing disinflation trend against a backdrop of global uncertainty, including Middle East tensions S2S5. Through the same period the Committee kept the Cash Reserve Ratio for deposit money banks at 45%, for merchant banks at 16%, and for non-TSA public-sector deposits at 75% S2
The eNaira and digital currency policy
The CBN has also used its currency-issuing mandate to experiment with digital money. On 25 October 2021, President Muhammadu Buhari formally launched the eNaira in Abuja as Nigeria's central bank digital currency (CBDC), with the government's own account of the launch stating that Nigeria had thereby "become the first country in Africa" to introduce a digital currency to its citizens, developed with Barbados-based technical partner Bitt Inc S7. At the official launch, President Buhari argued the CBDC could add up to $29 billion to Nigeria's GDP over ten years by improving cross-border trade, deepening financial inclusion outside the formal banking system, and increasing remittance flows, while then-CBN Governor Godwin Emefiele reported 500 million eNaira already minted, 33 banks integrated and over 2,000 customers onboarded at launch S7
Naira redesign and the 2022–2023 currency crisis
Later the same governor's tenure was dominated by a more contentious currency intervention. In late 2022 the CBN announced a redesign of the ₦200, ₦500 and ₦1,000 notes, released to the public from 15 December 2022, with an original deadline requiring old notes to cease being legal tender by 31 January 2023 — a timeline the Bank subsequently pushed back amid a severe nationwide cash shortage S3. Sixteen state governors challenged the policy in court, and on 3 March 2023 the Supreme Court ruled that the redesign, as implemented, had violated the 1999 Constitution and ordered the old notes to remain legal tender alongside new ones until 31 December 2023 S3. The federal government sought a further extension as that deadline approached, and on 29 November 2023 the Supreme Court ruled that old and redesigned notes would continue to co-exist as legal tender "until further notice," effectively removing any fixed cut-off date S3. President Bola Tinubu, who took office in May 2023, subsequently suspended Governor Emefiele from office on 9 June 2023 pending an investigation into his conduct and planned financial-sector reforms; Emefiele was arrested by the Department of State Services the following day and Deputy Governor Folashodun Shonubi was named acting Governor S9
FX unification and the Cardoso era
President Tinubu's government moved quickly on foreign-exchange policy as well. On 14 June 2023, the CBN directed banks to stop capping the naira's rate on the official Investors' and Exporters' window, collapsing the country's multiple exchange-rate windows into a single, market-determined "willing buyer, willing seller" system intended to close a gap that had seen the official rate near ₦462 to the dollar against a parallel-market rate as high as ₦755, a distortion that had trapped hundreds of millions of dollars in unmet airline repatriation demand and pushed some multinational firms to source dollars well above the official rate S8. The naira depreciated sharply immediately after the float and continued to weaken through 2024, closing that year at roughly ₦1,535 to the dollar compared with about ₦997 at the end of 2023 — a decline of about 40.9% over the year S8. Olayemi (Yemi) Cardoso, a former Citibank Nigeria chairman and Lagos State economic-planning commissioner, was appointed by President Tinubu on 15 September 2023 to lead the CBN through this period, taking over on a five-year term subject to Senate confirmation S4. Under Cardoso, the Bank has continued to frame FX unification, alongside continued disinflationary monetary policy, as central to restoring the naira's credibility and attracting foreign portfolio investment, though critics note the reforms came with a heavy short-term cost to consumers and importers as the naira exchange rate adjusted S8S5
Development finance and other functions
Beyond monetary policy, the CBN has periodically used its balance sheet for targeted development-finance interventions rather than leaving credit allocation entirely to commercial banks. The Anchor Borrowers' Programme, launched in November 2015 to finance smallholder agriculture through partnerships between farmers, processors and participating banks, is one such scheme still administered by the Bank's Development Finance Department, illustrating how the CBN's mandate extends into agricultural and industrial policy well beyond interest-rate setting S6. This intervention role — like the naira redesign and the eNaira launch — has drawn debate among economists over how far a central bank should extend beyond its core price- and financial-stability mandate, a debate that remains unsettled in Nigerian policy circles and connects directly to the wider institutional landscape covered in nigerian presidency and agriculture in nigeria S6