– Central Bank of Nigeria may limit across-
the-counter withdrawals to N10,000
– This is due to the recording a decline of
about N1.03tn in total deposit in Nigerian
banks
CBN may limit across-the-counter
withdrawals to N10,000
Nigerians are in for hard time as the
country’s apex bank, Central Bank of Nigeria
(CBN) has been told to limit across-the-
counter withdrawals to N10,000, following a
major drop in customers’ deposit.
The call, made by Bankers Committee was
due to with the industry recording a decline
of about N1.03tn in total deposit.
According to a report by Punch, between
April 2015 and April 2016, the total deposits
of bank customers with the Deposit Money
Banks dropped by 5.6 per cent or N1.03tn
from N18.54tn to N17.51tn.
The banking sector also recorded a decline
of N154bn in total assets within the one year
period, from N27.58tn in April 2015 to
N27.43tn as of April 2016.
The industry’s gross credit to the private and
public sector dipped by N41bn or 0.3 per
cent from the April 2015 value of N13.4tn to
N13.36tn in April 2016.
The CBN in the document quoted in the
report explained that the industry was
operating above the minimum requirement of
30 per cent.
It said as of April 2016, the banking sector’s
liquidity ratio stood at 46.3 per cent as
against 39.79 per cent as of April 2015.
It said the sector also recorded a decline in
earnings within the period as unaudited
profit before tax for the industry decreased
by 10.8 per cent (N24bn) from N222bn in
April 2015 to N198bn at the end of April this
year.
CBN further explained that the banking
sector was still faced with a lot of pressure
points, some of which it listed as resurgence
of inflationary pressures in the face of
negative output growth; continuing low oil
prices; and lack of fiscal buffers.
Others are capital flow reversals; rising
pressure on exchange rate in the face of
declining external reserves; huge growth in
credit to the government to compensate for
declining oil receipts.
According to the document, the bank is
faced with policy challenges in the areas of
stimulating output growth even with high
rates of lending and inflation; and ensuring
flow of credit to the real sector of the
economy with liquidity trap in the banking
sector.
The huge decline in banks’ deposits,
according to sources in the banking sector,
has forced most of the banks to increase
the targets given to bank workers, in a bid to
improve their liquidity position.
But a top bank official quoted in the report
said the sad development was due to the
withdrawal of government funds through the
implementation of the TSA.
“ The competition for deposit mobilisation is
very high now in the banking sector because
since the government withdrew its funds
through the TSA last year, a lot of banks were
seriously affected.
“So, it has been challenging now for bank
workers to mobilise deposits from customers
as we used to do because of the economic
situation.
“A lot of people are struggling to survive and
even many of those that we meet when we go
out to canvass for deposits will tell you that
they are in need of money.”
the-counter withdrawals to N10,000
– This is due to the recording a decline of
about N1.03tn in total deposit in Nigerian
banks
CBN may limit across-the-counter
withdrawals to N10,000
Nigerians are in for hard time as the
country’s apex bank, Central Bank of Nigeria
(CBN) has been told to limit across-the-
counter withdrawals to N10,000, following a
major drop in customers’ deposit.
The call, made by Bankers Committee was
due to with the industry recording a decline
of about N1.03tn in total deposit.
According to a report by Punch, between
April 2015 and April 2016, the total deposits
of bank customers with the Deposit Money
Banks dropped by 5.6 per cent or N1.03tn
from N18.54tn to N17.51tn.
The banking sector also recorded a decline
of N154bn in total assets within the one year
period, from N27.58tn in April 2015 to
N27.43tn as of April 2016.
The industry’s gross credit to the private and
public sector dipped by N41bn or 0.3 per
cent from the April 2015 value of N13.4tn to
N13.36tn in April 2016.
The CBN in the document quoted in the
report explained that the industry was
operating above the minimum requirement of
30 per cent.
It said as of April 2016, the banking sector’s
liquidity ratio stood at 46.3 per cent as
against 39.79 per cent as of April 2015.
It said the sector also recorded a decline in
earnings within the period as unaudited
profit before tax for the industry decreased
by 10.8 per cent (N24bn) from N222bn in
April 2015 to N198bn at the end of April this
year.
CBN further explained that the banking
sector was still faced with a lot of pressure
points, some of which it listed as resurgence
of inflationary pressures in the face of
negative output growth; continuing low oil
prices; and lack of fiscal buffers.
Others are capital flow reversals; rising
pressure on exchange rate in the face of
declining external reserves; huge growth in
credit to the government to compensate for
declining oil receipts.
According to the document, the bank is
faced with policy challenges in the areas of
stimulating output growth even with high
rates of lending and inflation; and ensuring
flow of credit to the real sector of the
economy with liquidity trap in the banking
sector.
The huge decline in banks’ deposits,
according to sources in the banking sector,
has forced most of the banks to increase
the targets given to bank workers, in a bid to
improve their liquidity position.
But a top bank official quoted in the report
said the sad development was due to the
withdrawal of government funds through the
implementation of the TSA.
“ The competition for deposit mobilisation is
very high now in the banking sector because
since the government withdrew its funds
through the TSA last year, a lot of banks were
seriously affected.
“So, it has been challenging now for bank
workers to mobilise deposits from customers
as we used to do because of the economic
situation.
“A lot of people are struggling to survive and
even many of those that we meet when we go
out to canvass for deposits will tell you that
they are in need of money.”
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