In line with the cash reserve ratio compliance requirement, the Central Bank of Nigeria has debited N1.977tn from several banks in the last quarter of 2020.
This has left many of the banks cash-trapped and unable to pursue various profitable ventures.
The cash reserve requirement is the minimum amount banks are expected to have with the CBN from customers’ deposits.
In January, the CRR was increased by five per cent to 27.5 per cent by the CBN’s Monetary Policy Committee, with the MPC explaining that the decision was intended to address monetary-induced inflation while retaining the benefits from the CBN’s LDR policy.
In January 2020, the MPC raised the CRR by five per cent to 27.5 per cent.
The move shocked bankers who had expected the CBN to taper down on its tight monetary policies considering the economic headwinds.
In April, the apex bank debited 29 banks the sum of N1.469tn with Zenith Bank accounting for N355.9bn, UBA: N204.7bn; First Bank: N206.1bn and Stanbic IBTC: N143.9bn of the total fine.
The CBN followed this up in June, debiting 26 banks to the tune of N459.7bn for failure to meet their CRR obligations.
Among the banks that were most affected are United Bank for Africa Plc (N82.3bn), FBN(N59.3), Zenith Bank Plc (N50bn), First City Monument Bank (N45bn), and Guaranty Trust Bank Plc (N40bn).
In its latest sanction, 14 banks were debited to the tune of N118bn, the lowest in three months. The move, in addition to similar policies by the CBN, has left many banks cash-trapped and unable to pursue various profitable ventures.
According to data obtained from the CBN, Stanbic IBTC Bank Plc and Guaranty Trust Bank got the highest debits of N15bn, while Union Bank of Nigeria Plc was debited N12.5bn, and FBN was debited N12.4bn.
Fidelity Bank Plc, Citibank, FCMB were debited NN11bn, N10.2bn, and N10bn, respectively.
Meanwhile, among the five biggest banks, Access Bank got the least sanction with a debit of N3bn in July followed by Zenith Bank Plc’s N7bn.