Banks’ deposits with CBN hit N3.17tn in nine months

The Central Bank of Nigeria has recorded N3.17tn deposits from 11 commercial banks in nine months.

Data obtained from the financial statements of the commercial banks listed on the Nigerian Stock Exchange showed that the deposits were made between January and September 2019.

Mandatory reserve deposit is not available for use in a bank’s day-to-day operations.

It represents a percentage of the customers’ deposits and is non-interest bearing.

The amount, which is based on qualified assets, is determined by the CBN from time to time and for the purpose of statement of cash flows and the balance is excluded from the cash and cash equivalents.

From Access Bank Plc, the CBN received N79.63bn while N985.98bn was recorded from Ecobank.

Fidelity Bank Plc, First City Monument Bank Plc and FBN Holdings each recorded N418.30bn, N172.73bn and N697.45bn deposits with the CBN.

Guaranty Trust Bank Plc, Stanbic IBTC and Sterling Bank paid N89.61bn, N319.7bn and N123.16bn to the CBN during the period while N300.59bn, N518.86bn and N9.43bn were received from Union Bank Nigeria Plc, United Bank for Africa Plc and Unity Bank Plc.

The CBN was given a legal backing by the CBN Act No.24 of 1991 to obtain from all banks returns on all credits with a minimum outstanding balance of N100,000 (now N1m and above of principal and interest), for compilation and dissemination by way of status report to any interested party (operators or regulators).

The Act made it mandatory for all financial institutions to render returns to the Credit Risk Management System in respect of all their customers with an aggregate outstanding debit balance of N1m and above.

It also required banks to update the credits monthly, as well as make a status enquiry on any intending borrower to determine their eligibility or otherwise.

Banks are penalised for non-compliance with the provisions of the Act.