FBN Holdings Plc yesterday said that its subsidiary, First Bank of Nigeria Limited, has settled the N1.88 billion fines imposed on the bank by the Central Bank of Nigeria for defaulting on the apex bank’s directive on Treasury Single Account (TSA).
Confirming the settlement of fines in a filing with the Nigerian Stock Exchange (NSE), FBN Holdings said that its management is still engaging the apex bank in conversation over the decision.
FBN Holdings also assured the public that First Bank of Nigeria Limited and the entire FBN Group are responsible corporate citizens and remain committed to values epitomised by strict compliance to the highest standards of ethics and corporate governance. Meanwhile, the bank’s shares fell by 3.9 per cent to settle at N5.10, its lowest since April following the imposition of the fines.
It would be recalled that the Federal Government had given September 15 deadline for all Ministries, Departments and Agencies of government to move their funds for state-owned bodies to the Treasury Single Account at the central bank in a move designed to clamp down on corruption and financial waste in the public sector.
Following reports of non-complaince, the apex had fined First Bank the sum of N1.88 billion for failing to transfer deposits of state companies to the CBN. First Bank had concealed N37.55 billion belonging to the Nigerian National Petroleum Corporation’s (NNPC) instead of remitting it to the TSA as directed. The penalty imposed on the bank was the equivalent of five per cent of the funds it failed to remit, while the bank’s account was debited for the unremitted amounts and the penalties.
At the last Bankers’ Committee held in Lagos early this month, the central bank officials had impressed on the banks the need to comply with the directive, saying that it had it on good authority that some banks were colluding with some ministries, departments and agencies (MDAs) to conceal their funds. In response, the bank chief executives said that they had a directive from the Accountant-General of the Federation to a Director in the CBN exempting some MDAs from transferring their funds to the TSA.
According to reports, a week after the meeting, CBN discovered that some banks had still not complied and proceeded to call all tier 1 banks reminding them that they must do so, otherwise they would be sanctioned. They responded again stating that the Office of the Accountant General had again sent them a schedule asking them to disclose how much of the funds belonging to MDAs had been transferred and how much was still with the banks.
Thereafter, the CBN Director, Banking Supervision, Mrs. Tokunbo Martins, then wrote to the banks asking that they furnish it with information on any unremitted funds, after which it was established that First Bank and UBA had failed to remit N58.8 billion and N37.5 billion respectively, leading to the imposition of the penalty of N4.819 billion on both
