Enterprise risk management professionals take steps to promote financial stability

Enterprise risk management professionals in Nigeria have taken steps to promote economic stability in the country. One of such steps is the inauguration of Basel Accord Day and the Global Financial Regulations Week.

The professionals, under the aegis of Association of Enterprise Risk Management Professionals (AERMP), did the inauguration during a virtual ceremony in Lagos recently.

Basel Accords are a series of banking supervision accords developed by the Basel Committee on Banking Supervision (BCBS) to regulate the banking sector and promote global financial stability.

The accords establish minimum capital requirements and risk management standards for banks, aiming to improve their ability to withstand financial shocks and enhance transparency and risk management practices.

During the conference, bankers, policymakers, financial regulators, academia, risk officers, analysts, enterprise risk professionals, fintechs, and other attendees advocated the adoption of the Basel Accord by every banking and financial institution for financial stability.

The experts praised AERMP for the inauguration of Basel Accord Day, which was part of activities to mark the newly inaugurated Global Financial Regulations Week (FINREG) by the association.

The conference aimed to sensitise bankers and other financial services sector stakeholders on the Basel Accord and how it shapes the economy and performance of financial institutions and the nation.

AERMP President, Taiwo Ige, said the theme, ‘Imagine a Financial World Without the Basel Accord,’ was apt to inspire experts to explore, interrogate, and reimagine the foundations of global financial regulations.

Ige gave a brief history of the Basel Accords, beginning with Basel I in 1988, through Basel II and the much more refined Basel III and IV, adding that the two provided upgraded guidelines as lifelines for global financial stability.

“They have helped institutions remain solvent, instilled discipline in capital allocation, promoted transparency, and, in many cases, shielded entire economies from collapse,” she said.

Ige, a fellow of Enterprise Risk Professionals, urged participants to proffer solutions to strengthening risk culture in Nigeria and Africa in a constantly shifting risk landscape.

She noted that the AERMP would continue to take bold steps in advancing the frontiers of enterprise risk management in the nation.

Olayinka Odutola, Director General/Chief Executive Officer, AERMP, said the association was the first globally to inaugurate and celebrate a Basel Accord Day as well as the Global Financial Regulations Week.

He said the inaugurations were important because regulators in the financial sector were unsung heroes who should be celebrated for their prominent roles.

Odutola, also a fellow of the association, said people need to know more about regulators; though not perfect, their absence could destroy banking institutions and the economies of countries.

He explained that the conference was about learning to understand the principles of the Basel Accord, pointing out the implications of not having or practising it.

Blaise Ijebor, the Director, Risk Management, Central Bank of Nigeria, delivering a keynote, said the Basel Accord was instituted to restore confidence after shocks that collapsed some prominent banks in Europe.

Blaise, a chartered risk management expert and fellow of the association, said the Basel Accord had introduced efficiency into transborder transactions and other national banking practices.

He added that risk experts are guardians of trust for organisations while reeling out ethical requirements for the professionals to boost investors’ confidence and investments in Nigeria.

He explained efforts of the CBN on adoption of the Basel Accords as well as ongoing efforts to upgrade to the highest and latest version.

Temidayo Fasipe from the Development Finance Institutions Supervision Department of CBN, spoke on the topic: ‘Basel Accords: Journeys from Basel I to IV.’

He said that an analytical exploration of the evolution and key reforms of the Basel Accords aimed at strengthening global banking stability through successive financial crisis impacts and regulatory milestones.

Fasipe explained the role of the Basel Accord in banking regulation to prevent both banking and currency crises as well as balance of payment crises.

According to him, banking crises are not frequent, but the impact of their occurrence is usually high, hence, the need for effective regulation.

“Historically, the absence of a central bank has led to severe financial crises, demonstrating the need for regulatory oversight,” he said.

Bayo Olugbemi, a former President, Chartered Institute of Bankers of Nigeria, and Biodun Adedipe, a fellow of the association, spoke on how actions or inactions of professionals could impact the whole world either positively or negatively.

They agreed that if professionals did it right by not cutting corners, and pay desired attention to the regulatory frameworks like the Basel Accord, Nigeria and global economies would experience stability.

Dignitaries at the event included Kehinde Adetiloye and Ochei Ikpefan, both professors and of Finance Department of Covenant University; Prof Ehi Esoimeme and Dr Sam Utulu of James Hope University; Francis Agboola, former Director/Chief Learning Officer, NDIC, among others.