CBN Lifts Forex Ban On UBA

The Central Bank of Nigeria, CBN, on Wednesday, August 24, lifted it’s ban on the United Bank for Africa, UBA, following a recent disclosure that about nine commercial banks, UBA inclusive were hiding over $2 billion belonging to Nigerian National Petroleum Corporation (NNPC) from the Treasury Single Account,TSA.

Although UBA almost immediately cleared its name from the controversy, eight deposit money banks remain banned from the foreign exchange market.

‘Tokunbo Martins, director, banking supervision of CBN, made the announcement in Abuja, saying: “Further to the directive of the Central Bank of Nigeria (CBN) to all Deposit Money Banks (DMBs) to return all outstanding unremitted NNPC/NLNG foreign currency, this is to confirm that the United Bank for Africa (UBA) Plc has remitted all outstanding NNPC/NLNG deposits in its possession to NNPC’s Treasury Single Account (TSA) at the CBN.

“Accordingly, the United Bank for Africa (UBA) Plc has been re-admitted into the Foreign Exchange Market effective Thursday, August 25, 2016.”

At the full implementation of the TSA in 2015, the CBN had warned that banks that did not totally comply with the TSA remission plan risked possible fine and stringent punishment.

“The CBN may take action against any FXPD that fails to comply with the standards set forth in these Guidelines. Such action will vary depending upon the type of non-compliance, but may range, for instance, from fines, suspension from any or all FX operations for a period of time to termination as an FXPD,” it had said.

All the indicted banks are barred from the forex market until they fully refund the $2.1 billion held up in their coffers.

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