Breaking: CRR: CBN Debits Banks N120.2 Billion

The Central Bank of Nigeria,CBN, debited banks a total of N120.2 billion according to information reaching Nairametrics from sources with knowledge of the matter.

Nairametrics tracks CRR debits implemented by the CBN from time to time and estimates over N10 trillion has been sequestered from banks in the last year and a half.

The central bank debits bank deposits when they do not meet the minimum lending requirement imposed by the apex bank.

In a list seen by Nairametrics, Zenith Bank topped the list with about N39 billion debited followed by Citi Bank and UBA with N16 billion and N12 billion respectively. A total of 15 banks had their CRR debited out of the 28 banks currently listed by the CBN as commercial and merchant banks.

What it is used for

Recently, the central bank introduced zero-coupon Special Bills which are issued to banks in exchange for the CRR debits. Critics of the CBN’s CRR debits suggest the money is used to fund the apex bank’s intervention programs in the economy as well as fund the government’s revenue shortfall via Ways and Means.

Banks, on the other hand, complain that the CRR debits have affected interest margins as they will rather have their vaults debited than increase their risk profiles.

 

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