Why CBN Barred Nine Banks from Forex

Street talk in Nigeria has it that Nigerian Banks operate like legitimate businesses run by crooks or more like crooked businesses run by dubious people. It appears Nigeria’s Central Bank has just found that one out. As part of its regulatory functions and in a very clear reaction to it, the CBN has barred nine erring commercial banks from all foreign exchange transactions and operations. A very severe punishment and quite shocking indeed considering the importance of Forex to the overall viability and profitability of most Nigerian money deposit Banks.

Reports coming out of the apex Bank indicate that the nine banks were barred for hiding some $2.12 billion belonging to the nation’s oil corporation, the Nigerian National Petroleum Corporation, NNPC. That they all deliberately neglected or failed to remit the funds into the Treasury Single Account, TSA, a key policy trust of President Muhammadu Buhari’s administration. The Banks are to remain shut out from foreign exchange transactions until they fully remit the NNPC funds into government coffers via the Treasury Single Account, the apex Bank insists.