ABUJA (Sundiata Post) – The Central Bank of Nigeria has threatened to sanction any of the participating deposit money banks in the implementation of its Nigerian Electricity Market Stabilization Facility that contravenes the terms and conditions under the facility.
The apex bank in a circular signed by the Director, Financial Policy and Regulation, Kevin Amugo and issued on Monday, said it would impose monetary sanctions as well as termination of participating mandate of any bank that defaults the gems and conditions of the CBN/NEMSF.
According to the CBN, sanctions that may be imposed are not limited to those listed, and the Central Bank of Nigeria may impose additional sanctions, and in such form as it may deem fit including regulatory action against officers of defaulting banks.
It noted further that any “penalties imposed as a result of sanctions may be directly offset against any fees payable to a Deposit Money Bank under the CBN-NEMSF.” The apex bank in the sanctions grid said the closure of a Transaction Account by DMB without the prior written consent of the Refinancer will attract a fine of N2 million for the first infraction and termination of its mandate at further infractions.
Also, the apex bank said any bank that opens additional bank account for a beneficiary distribution company, whether or not, for the purpose of receiving payments, fines and fees for electricity consumed by its customers without the prior written consent of the refinancer, “shall pay a penalty of N2 million on each account opened and shall be instructed by the Refinancer to close the account and transfer all funds in the account into the Principal Collection Account (PCA) within 24hours.
“If the infraction is not remedied after the expiration of the 24 hours, the bank will be liable to a penalty of N2 million per day for the number of days the account remains open” adding that any further infraction will result in the “termination of the DMB’s participation as a Mandate Bank under the CBN-NEMSF.”