CBN To Slam Fine On Banks For Breaching Counterfeit Notes Law

CBN’s Director of Currency Operations, Priscilla Ejeje

 

The Central Bank of Nigeria (CBN) says it will slam a fine on commercial banks found culpable of breaching the law on counterfeit notes.

While appearing on Channels Television’s Business Morning on Thursday, CBN’s Director of Currency Operations, Priscilla Ejeje, said the move is part of the apex bank’s reforms to ensure there are clean notes in circulation.

“Once notes are unfit, they are expected to be withdrawn from circulation. That is our job as a Central Bank. We have told them (commercial banks), we have been engaging them.

“And we believe that they will do their bits. And this time around, we are giving a voice to the public. We have a having a lot of sensitisation all over the country so that the public will also know what their right is and that they have a right to complain to the Central Bank

“So we will go in and investigate a breach and of course we have told them that beginning with counterfeit, there is a penalty for a breach. And that penalty is one million naira per finding in any branch,” she stated.

READ ALSO: FG Has Disbursed Over N3.5tn For Infrastructure Development In Three Years – Osinbajo

Reacting, the Director of Corporate Communication at the apex bank, Isaac Okoroafor, said counterfeiting is a serious offence under the law.

While calling on the public to report any incident of fake or unfit currency, the CBN spokesman explained that the rationale behind it is to reduce the menace.

“It is the role of individuals to report any breach of this policy and guidelines to us and it is our role to take action.

“It is also the role of the banks to ensure that unfit notes are returned to us. It is our role to ensure we destroy that note and issue a new one to replace it.”

According to Okoroafor, the cost of currency management and minting by the Central Bank is enormous, hence the need to ensure that only clean notes are in circulation.

French Banks Call For End To ‘Yellow Vest’ Violence

Women march with balloons during a rally of the Women’s Yellow Vest protest movement (Femmes Gilets jaunes) near Place de la Bastille in Paris on January 6, 2019. France’s “yellow vest” protesters were back on the streets again on January 5 as a government spokesman denounced those still protesting as hard-liners who wanted only to bring down the government.
Bertrand GUAY / AFP

 

French banks called Saturday for an end to violence against branches, cash machines and personnel as the country braced for a 20th day of “yellow vest” protests.

Since the “yellow vest” anti-government protests began in November, more than 760 banks have suffered damage.

“It is time for all to condemn acts committed against banks,” the French banking federation’s executive committee said in comments published in the daily Le Monde.

“Yellow vest” demonstrations are expected Saturday in several French cities despite bans in hotspots such as the Champs-Elysees avenue in Paris and the centre of Bordeaux.

Banks have often been the targets of vandalism and arson during the protests, and last week 11 people were injured when a Banque Tarneaud branch was set on fire near the Champs Elysees.

“We must quickly put a stop to this unbridled and unjustified violence,” the federation said.

It called for order to be restored “so that our colleagues and shop owners can work safely” and meet their clients needs.

The call was echoed by the police union Alliance, which told AFP Saturday its members “were fed up” with critics that sought to blame them for the violence.

“Our duty is to maintain public peace, even if that sometimes means restoring public order,” Alliance secretary-general Frederic Lagache said.

The banking federation’s executive committee comprises the bosses of six large French banks; BPCE, BNP Paribas, Credit Mutuel, Banque Postale, Credit Agricole and Societe Generale.

“For a little more than four months, hundreds of local branches that are essential links in local life… have been targeted, vandalised, pillaged and burned, and bank officers physically threatened,” the federation said.

With taxes a key trigger in the initial protests, it said French banks were the primary contributor to fiscal revenues, paying 644 euros ($720) for each 1,000 euros in net profit, excluding social charges.

France counts 37,000 bank branches and the sector employs more than 360,000 people.

CBN Reviews Capitalisation Of Tier 2 Microfinance Banks

CBN Reviews Capitalisation Of Tier 2 Microfinance Banks

 

The Central Bank of Nigeria (CBN) has reviewed the minimum capital base of Tier 2 Microfinance Banks (MFBs) across the country to N50m, informing them to recapitalise by April 2021.

The apex bank, however, maintained the capital base of Tier 1 for State and National Microfinance Banks earlier issued on October 22, 2018.

In a circular to all microfinance banks on Monday by the Director, CBN Finance Policy and Regulations, Mr Kevin Amugo, the financial regulator Tier 2 MfBs must meet a N35m capital threshold by April 2020 and N50m by April 2021.

“The Central Bank of Nigeria has revised the categories of microfinance banks with a view to ensuring continued operations of microfinance banks in the rural, unbanked and underbanked areas of the economy,” the CBN said.

READ ALSO: Emefiele, Three Governors Discuss How To Boost Palm Oil Production

It explained further, “Accordingly, the unit microfinance banks shall comprise two Tiers: Tier 1-unit microfinance bank which shall operate in the urban and high-density banked areas of the society; and Tier 2-unit microfinance banks which shall operate only in the rural, unbanked or underbanked areas.

“Tier 1-unit microfinance banks must meet a N100m capital threshold by April 2020 and N200m by April 2021.”

The apex bank noted that the Tier 2-unit microfinance banks must meet a N35m capital threshold by April 2020 and N50m by April 2021.

According to it, state microfinance banks shall increase its capital to N500m by April 2020 and N1 billion by April 2021.

“A national microfinance bank shall hold a capital of N3.5 billion by April 2020 and N5 billion by April 2021,” it added.

The CBN had raised the minimum capital base of MFBs on October 22, 2018, explaining that the revision became inevitable as the sector had been contending with challenges such as inadequate capital base, weak corporate governance, and ineffective risk management practices, among others.

Alleged Illegal Repatriation: CBN Deducts N5.61bn From Three Banks

Nigeria's Foreign Exchange Inflow Hits $91b In 2017 – CBN

 

The Central Bank of Nigeria has deducted a total of N5.61 billion from the accounts of three banks as fines it imposed on them last week for alleged illegal repatriation of funds for telecoms giant, MTN.

According to a report by Reuters, the three banks include Standard Chartered which was debited N2.47 billion, Stanbic IBTC N1.88 billion, and Citibank Nigeria N1.26 billion.

Although four banks were sanctioned last week by the regulator, it is not yet clear if the N250 million fine on Diamond Bank was deducted from its account by the CBN.

Meanwhile, Standard Chartered Bank and Citibank have confirmed the deductions and notified their parent companies in South Africa and the United States about the development, pledging full co-operation with the CBN to resolve the issue as soon as possible.

Stanbic IBTC also confirmed the deduction in a statement on Thursday.

The bank said, “Following our earlier announcement to The Nigerian Stock Exchange (NSE) on 30 August 2018, in respect of the penalty of N1.886 billion imposed by the Central Bank of Nigeria (CBN) on our banking subsidiary – Stanbic IBTC Bank PLC (the Bank) in relation to the remittance of foreign exchange on the basis of certain capital importation certificates issued to MTN Nigeria Communications Limited, we write to update the NSE that the CBN has debited the account of our banking subsidiary with the CBN for the full amount of the above-stated fine advised to the Bank.

“Stanbic IBTC Holdings PLC, as well as our banking subsidiary, maintain our position on this matter, which is the fact that the Bank has done nothing illegal and accordingly the Bank will continue to provide CBN with documents and details in support of our contention that our actions in relation to these transactions were not illegal.”

Bank Loans To Private Sector Drop To N15.3tn

NBS

 

Banks reduced lending to the private sector from N15.6 trillion allocated within the first quarter of 2018 to N15.34 trillion in the second quarter.

The National Bureau of Statistics (NBS) disclosed this in its 2018 Q2 report titled: Selected Banking Sector Data: Sectorial Breakdown of Credit, ePayment Channels and Staff Strength (Q2 2018).

The report also indicated that loans to the power and energy sector dropped to N416.34 billion, while that of the mining and quarry fell to N10.18 billion.

It, however, noted that total lending to the agriculture sector increased to N523.08 billion while the Oil & Gas and Manufacturing sectors got credit allocations of N3.45trn and N2.02trn to record the highest credit allocations within the period under review.

Furthermore, the NBS stated that a total volume of 509,668,433 transactions valued at N32.90 trillion, were recorded in Q2 as data on Electronic Payment Channels in the Nigeria Banking Sector.

Also, it said, Automated Teller Machine (ATM) transactions dominated the volume of transactions recorded, totalling N1,603billion in Q2.

The total number of bank staff increased by 13.67% from 89,608 in Q1 to 101,861.

NDIC To Investigate Banks Over Fraud

NDIC, Customer protection

 

 

The Nigeria Deposit Insurance Corporation (NDIC) is to investigate some banks over fraud related cases in their transactions.

A statement from NDIC’s HEAD, Communications and Public Affairs, Mohammed Ibrahim, said the move was in line with Section 35 and 36 of the NDIC Act No. 16 of 2006 for all Deposit Money Banks (DMBs) to submit monthly information/returns on fraud and forgeries to the Corporation.

“The Nigeria Deposit Insurance Corporation (NDIC) is to investigate some banks for the inadequate rendition of returns to the Corporation,” Ibrahim said on Sunday.

The commission is faulting banks for their failure to deliver returns on instances of fraud, forgeries, and cases involving members of their staff who were either dismissed or had their appointments terminated on grounds of fraudulent activities.

“Section 35 and 36 of the NDIC Act No. 16 of 2006 (as amended) requires all Deposit Money Banks (DMBs) to submit monthly information/returns on fraud and forgeries to the Corporation,” the statement read in part.

Ibrahim explained that NDIC made the decision in the light of the most recent report from its Off-Site Supervision of the DMBs which revealed the number of fraud cases attributed to internal abuse by staff of banks increased from 231 in 2016 to 320 in 2017, or 38.53% above the figure reported for the previous year.

It was observed that the report relied on a total of 286 responses received from 26 banks during the period. Also, there were 22 NIL monthly responses from the banks as at year ended 31st December 2017.

On Internet banking and ATM/Card-related fraud, the agency reported constituted 24,266 resulting in 92.68% of all the reported cases. It, however, regretted the avoidable loss of ₦1.51 billion of losses in the Industry in 2017.

The report also documented other miscellaneous crimes such as fraudulent transfers/withdrawals, cash suppression, unauthorized credits, fraudulent conversion of cheques, diversion of customer deposits, diversion of bank charges, presentation of forged or stolen-cheques among others.

It is expected that banks would adopt internal control measures in the wake of proactive corrective measures taken to ensure their compliance with good corporate governance principles.

CBN Orders Banks With Huge Bad Loans To Stop Paying Dividends

CBN Orders Banks With Huge Bad Loans To Stop Paying Dividends

 

Banks and discount houses with non-performing loans above 10 per cent will no longer be allowed to pay dividends to their shareholders.

The Central Bank of Nigeria gave the directive as part of measures to curb the increase in non-performing loans and to stop further erosion of the capital base of the banks.

The directive comes about a week to the release of the 2017 financial year’s annual reports by commercial banks and discount houses in the country.

Data from the apex bank puts the banking industry’s non-performing loans at 15.18 per cent as at September 2017.

Meanwhile, transactions in the fixed income and currency markets declined to N11.71 trillion in January 2018, from N11.86 trillion in December 2017.

According to data from the FMDQ OTC exchange, the treasury bills market accounts for 39.24 per cent of market turnover as against 35.26 per cent in December.

The foreign exchange market also accounted for 37.50 per cent of the total turnover, while the money market was responsible for 16.9 per cent.

These three segments combined, contributed 93.64 per cent of the total turnover in the fixed income market.

Transactions in the FX market settled at $14.01 billion for the period, showing an increase of $1.15 billion from the amount recorded in December 2017.

FG Gazettes IPOB Ban, To Notify Banks, Embassies, Foreign Missions

A file photo of IPOB supporters agitating for Biafra country

Despite criticisms from different quarters, the Federal Government appears not to be backing down in its decision to proscribe the Indigenous People of Biafra (IPOB).

As part of the requirement to finalise the process, the Federal Government has gazetted the order of the Federal High court in Abuja proscribing and declaring the IPOB as a terrorist organisation.

The gazetting was part of the requirements imposed on the Federal Government by the court to finalise the prescription of the group.

READ ALSO: IPOB Prescription: Shehu Defends FG, Says Group Not Interested In Dialogue

Having gazetted the order, the Federal government is further set to publish it in two national dailies to complete the process.

The Acting Chief Judge of the Federal High Court, Justice Abdu Kafarati, on September 20, issued the proscription order based on an ex parte application by the Attorney General of the Federation and Minister of Justice, Mr Abubakar Malami.

However, IPOB, through its lawyer, Mr Ifeanyi Ejiofor, filed a motion before the same court two days after, seeking the nullification of the said order, citing lack of jurisdiction, among other grounds.

Federal Ministry of Justice is set to notify banks, Nigerian Embassies abroad and foreign missions operating in Nigeria on the move by the government.

Reps Committee Order Banks To Unfreeze Patience Jonathan’s Accounts

Patience Jonathan, Court, EFCC

The House of Representatives Committee on Public Petitions has directed that banks to allow wife of former President of Nigeria, Patience Jonathan to access some of her bank accounts that have been frozen.

This direction was given during the resumed hearing of the House of Representatives committee on public petitions, on Tuesday.

Patience Jonathan’s attorney had submitted a petition to the committee over what they described as the unwarranted and persistent attacks on her by agents of the Economic and Financial Crimes Commission and other government agencies (EFCC).

During the hearing, in which EFCC representatives were absent, the committee also directed the Federal Inland Revenue Service (FIRS) to meet with the petitioner’s counsel to resolve the issues regarding one of the businesses of Patience Jonathan.

Representatives of the FIRS were taken up by the committee on their visit to the petitioner’s business in Bayelsa State for allegedly evading paying tax.

The chairman of the committee, Uzoma Nkem-Abonta sought to get to the heart of the matter by hearing from the petitioner, the banks, and FIRS.

One of the members of the committee, Emeka Obiago, made it clear that the focus of the lawmakers is that people obey the laws of the land.

He said “We will not want to be seen in any way to shield anybody who tries to evade tax. Our position is we must be governed in accordance with the rule of law.”

Nkem-Abonta, therefore, directed that the banks should unfreeze all accounts that they have no pending court order.

“Until EFCC proves otherwise, I’ll ask you to remove the precautionary restriction on the account. Let me tell you, whatever you’ll do, you must follow the law. A bank can’t hold a legal entity to ransom.

“I want to order all other banks that all the accounts that have no specific pending order from the courts, please release them,’’ the committee chairman said.

Court Strikes Out FG’s Suit Against Seven Banks

Alleged N29bn Fraud: Court Admits More Evidence Against Nyako
File photo

The Federal High Court Sitting in Lagos has struck out a suit filed by the Federal Government against seven commercial banks.

Justice Chuka Obiozor struck out the suit this morning and awarded a cost of N200,000 against the Federal Government and in favour of all the affected banks except Skye Bank which was not represented in court.

The Federal Government had sued the banks seeking the remittance of $793.2 million allegedly hidden with them in contravention of the Treasury Single Account policy.

Yesterday, counsel for the Federal Government, Professor Yemi Akinseye-George, told the court that the Attorney-General of the Federation, Mr Abubakar Malami, asked him to withdraw the suit in the larger interest of the public and because of the economic implications.

The counsel had also disclosed that the Federal Government decided to explore an ‘out-of-court settlement’ with the banks.

Even though the banks did not oppose the notice of discontinuance of the suit, through their lawyers, they had insisted that the Government’s allegation against them was false and had caused substantial damage to their reputation.

They had also urged the judge not to merely strike out the suit but to dismiss it and award a cost of between N10-N20m against the Federal Government.

They argued that any case struck out could be re-filed while a case dismissed could no longer be re-filed.

But in his ruling today, Justice Obiozor held that dismissal of an action is one of the gravest actions a plaintiff can face and so the court must be slow to take that option and only exercise such a discretion judiciously.

Having considered the reasons for the withdrawal of the suit, the court held that since the case had yet to proceed to trial, the proper order to make was to strike it out.

In awarding cost, Justice Obiozor held that the banks had placed no evidence before him to support their claim that the actions of the Federal Government had caused damage to their reputation.

He, therefore, used his discretion to award a cost of N200,000 each.

The court also vacated the interim order made on the 20th of July in favour of the Federal Government directing the banks to temporarily remit the funds to the TSA.

Following the July 20 order, most of the affected banks had issued retractions and disclaimers, insisting that they had no illegal funds in their custody.

 

CBN Mandates Banks On PTAs, School Fees

CBN Mandates Banks On PTAs, School FeesThe Central Bank of Nigeria (CBN) has mandated all commercial banks in the country to immediately open a teller point for retail foreign exchange (FX) transactions in all locations.

The directive was contained in a memo issued to the banks by the CBN Director of Financial Markets Department, Dr. Alvan Ikoku.

The directive, according to the apex bank was to further increase FX availability to all end-users and ensure that a fair and verifiable exchange rate operates in the market.

The commercial banks were also mandated to have an electronic display board in all their branches showing rates of all trading currencies, while customers must insist on processing FX transactions based on the displayed rates.

The CBN noted further that henceforth, banks must process and meet the demand for travel allowances (PTA/BTA) by end-users within 24 hours of such application, as long as the end-users meet basic requirements already outlined in earlier directives.

For school fees and medical bills, the banks have 48 hours to meet customers’ demands.

The apex bank said non-compliance by any bank would attract sanctions, which may include but not limited to being barred from all future CBN foreign exchange interventions.

CBN Cannot Sustain The New Foreign Exchange Policy – Muda Yusuf

srThe Director General, Lagos Chamber of Commerce and Industry, Muda Yusuf says the Central Bank of Nigeria (CBN) cannot sustain the new Foreign Exchange Policy to improve the economy.

He noted that the CBN does not have the capacity.

According to him, “we need to create a window for capital competition to come in  to improve the foreign exchange”.

Mr. Yusuf made this known on Channels Television’s breakfast programme, Sunrise Daily.

He however, said “the fundamental issue with the foreign exchange situation in the country is a supply side issue, we have a supply crisis.

“This situation has come about because the CBN is virtually the only supplier in the market meanwhile, the CBN doesn’t have the capacity to support the market, they have always had supplies from autonomous sources.

“So, when you are dealing with this kind of method, you deal with it both on the supply side and on the demand side.

“What we have seen over the years is the concentration on managing demands, there is nothing on the table as we speak.

“To encourage supply, we need supply either from foreign direct investors, foreign portfolio investors or from our exporters”.

He added that the policy is only aggravating the demand.