GOVERNANCE ISSUES IN MICROFINANCE BANKS UNDER RISK-BASED MANAGEMENT (MFB/2024/22)

The bane of most Microfinance Banks in particular and many Financial Institutions in Nigeria is Risk Management LAX. As it is often said, no one can give what it does not have.

The Board of Microfinance Bank is the ultimate Risk Management organ of the Bank. A good knowledge of the Board in the area of Risk-Based Management will enable it perform the following responsibilities as the apex Risk Management Organ of the Bank:

• Approve and periodically reviews risk strategy and policies;
• Approve the bank’s risk appetite annually and monitors the bank’s risk profile against the appetite;
• Ensure that the Executive Management takes  necessary step to monitor and control risks;
• Ensure that management maintains an appropriate system of internal control and reviews its effectiveness;
• Ensure that risk strategy reflects the bank’s risk tolerance level;
• Ensure that the bank’s overall credit exposure is maintained at prudent levels and consistent with the available capital;
• Review and approve changes/amendments of the Risk Management Framework.
• Periodically receives risk reports from the Management highlighting key risk areas, control failures and remedial action steps taken by the Management among others.

COURSE OBJECTIVES

At the end of this Training, Participants will be able to:

1. Identify areas of risk management lax in their banks.
2. Perform their roles and responsibilities individually and as a Board in relation to the Management of Risks in their Banks.
3. Analyze and interpret risk management reports submitted by the Executive Management.
4. Identify Risk Management Control Functions of their banks and ensure that they are in place and functioning.
5. Exercise their oversight functions over the activities of the Executive Management.
6. Save their Banks from shocks and vulnerabilities occasioned by Risk Management Lax.