Banks That May Lose Billions Of Naira To CBN’s Directive On BVN Deadline

Banks That May Lose Billions Of Naira To CBN’s Directive On BVN Deadline

Like This Video 0 178728 rauf shola
Added by November 4, 2017

The biggest casualties in terms of deposit loss should the Federal Government go-ahead to implement court order on funds forfeiture for Bank Verification Number (BVN) non-compliant accounts will be the first generation banks (First Bank, Union Bank ).

These set of banks, according to an industry source who spoke anonymously, seem to have the largest number of customers that have stayed with them for close to or over 100 years.

Justice Dimgba Igwe of the Federal High Court, ruling on an ex parte application filed by the Federal Government through the Office of the Attorney-General of the Federation on October 21, granted the temporary forfeiture of funds in accounts not linked to BVN within two weeks unless the owners justify their ownership of such accounts. The deadline for compliance ended yesterday.

The source said it would be very difficult to put a figure to the 46 million accounts not linked to BVN, adding that: “The first generation banks are believed to have the largest number of dormant accounts, although that has not been established. These banks have the largest number of dormant accounts because of how long they have been in the business,” he said.

The source explained that some new generation banks also have a large number of accounts, but a majority of their customers are from the middle class. He said many of the customers joined the bank during or after the banking consolidation of 2005, in what is regarded in the banking industry as ‘’Flight to Safety’’.

“A lot of the middle class tend to associate more with some new generation banks. So, even though the accounts are many, but they remain largely active,” the source said.

The banks with the largest impact are likely to lose deposits running into billions of naira, and that may affect their liquidity positions.

The Federal Government has secured an interim forfeiture order from Federal High Court which would now allow it to freeze the accounts of bank customers in Nigeria who have no Bank Verification Number, BVN.

The order obtained before Justice Dimgba gave the Federal Government the nod to instruct the banks to disclose any investments made with these funds and to freeze any outward movement from these accounts.

The court order mandates the Central Bank of Nigeria (CBN) to appoint an examiner to look into the books of any commercial bank that fails to comply. The banks are expected to provide the names of accounts without BVN, account numbers, outstanding balances, domiciliary accounts without BVN, branch/locations where these accounts are domiciled.

The CBN through the Banker’ Committee and in collaboration with all banks in Nigeria on February 14, 2014, launched a centralised biometric identification system for the banking industry tagged Bank Verification Number (BVN). The BVN gives a unique identity that can be verified across the Nigerian Banking Industry (not peculiar to one bank) while bank customers are protected from unauthorised access.

 

Similar Videos

Gov. Ugwuanyi Deserves Second Term – Mbaka

0 141731 0

Outspoken Catholic cleric Rev. Fr. Ejike Mbaka says Enugu state governor Ifeanyi Ugwaunyi deserves a second term in office. The Spiritual Director of Adoration Ministry Enugu Nigeria (AMEN) described the governor as godly. He said this during his ministry’s harvest

Kenyan woman weds her lesbian model partner in the US

0 99013 0

A Kenyan woman has tied the knot with her American lover in a same-sex marriage. Manuella Mumbi, alias Manuelle Royale, a businesswoman born and brought up in Kahawa, Kiambu County, Kenya, exchanged vows with Lisa Webb Clay in low key

President Trump’s Hatred For Moslems An Example Of How Not To Be A Christian

0 135156 0

President Donald Trump and President Muhammadu Buhari“We have had very serious problems with Christians who are being murdered in Nigeria; We are going to be working on that problem very, very hard because we cannot allow that to happen.” –President

No Comments

No Comments Yet!

No Comments Yet!

But You can be first one to write one

Write a Comment

Your data will be safe!

Your e-mail address will not be published. Also other data will not be shared with third person.
Required fields are marked*