Markets

CBN debits Zenith Bank, UBA, 13 others N120bn over CRR default

The Central Bank of Nigeria (CBN) has debited banks a total of N120.2 billion for failing to meet its Cash Reserve Ratio (CRR) policy. 

The CRR debits implemented by the CBN from time to time is estimated to be over N10 trillion has been sequestered from banks in the last year and a half.

The CBN deposits when they do not meet the minimum lending requirement imposed by the apex bank.

Zenith Bank topped the list with about N39 billion debited followed by Citi Bank and UBA with N16 billion and N12 billion respectively.

A total of 15 banks had their CRR debited out of the 28 banks currently listed by the CBN as commercial and merchant banks.

Recently, the central bank introduced zero-coupon Special Bills which are issued to banks in exchange for the CRR debits.

Critics of the CBN’s CRR debits suggest the money is used to fund the apex bank’s intervention programs in the economy as well as fund the government’s revenue shortfall via Ways and Means.

Banks, on the other hand, complain that the CRR debits have affected interest margins as they will rather have their vaults debited than increase their risk profiles.

 

 

Felix Oloyede

Felix Oloyede is a Mass Communication graduate with 19 years experience in journalism. He has worked with TheWeek Magazine; Mirror Newspapers; West Africa BusinessNews and BusinessHallmark Newspaper. Oloyede has covered different news beats ranging from crime; arts; politics; commerce and industries to finance and economy. He is an alumnus of Bloomberg Media Initiative Africa. He has also attended different trainings on Media Communication at the Lagos Business School. He is an alumnus of Bloomberg Media Initiative Africa. He has also attended different trainings on Media Communication at the Lagos Business School.

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