By 𝔸bdulrazak Tomiwa

The Chairman of the Economic and Financial Crimes Commission (EFCC), Mr. Ola Olukoyede, has issued a stern warning to Nigerian banks against granting loans without credible and verifiable collateral.

This directive was delivered via Bawa Kaltungo, the Acting Zonal Director of the Lagos Zonal Directorate, during a courtesy visit by the Chief Audit Executive of First Bank Plc, Mufutau Abiola.

Olukoyede expressed deep concern over current lending practices, noting that loans based solely on personal guarantees or the influence of top executives often facilitate insider abuse and financial instability.

He emphasized that relying on non-tangible security puts depositors’ funds at risk, as banks act only as custodians of public money and must protect it through strict lending protocols.

The EFCC boss argued that ensuring every loan is backed by visible collateral would significantly reduce the rising rate of non-performing loans (NPLs) within the Nigerian banking sector.

Furthermore, he urged financial institutions to strengthen their due diligence processes and include liability clauses even when outsourcing background checks to third-party agencies to prevent future defaults.

To foster accountability, the commission requested that banks promptly release any staff members invited for questioning regarding suspected insider connivance or financial misconduct to aid ongoing criminal investigations.