By Kayode Ogunwale

The Central Bank of Nigeria (CBN) on Tuesday announced the imposition of a substantial sanction amounting to N1.35 billion against nine Deposit Money Banks operating within the nation.

This action was taken in response to the banks’ failure to adequately dispense cash through their Automated Teller Machines (ATMs) during the crucial yuletide season, a period typically characterized by increased demand for cash due to holiday spending.

The CBN’s decision serves as a significant demonstration of its unwavering stance on maintaining financial stability and ensuring an uninterrupted cash flow within the banking system. The regulatory body expressed its disappointment regarding the inability of these banks to meet the cash needs of their customers at such a critical time, emphasizing the importance of operational efficiency in the banking sector.

According to the central bank, the penalties were levied after a thorough investigation revealed that these nine banks were indeed negligent in providing sufficient Naira notes through their ATMs during the busy holiday season. This sanction not only emphasizes the CBN’s commitment to enforcing compliance among financial institutions but also seeks to encourage improved service delivery to customers in the future.

The affected banks include Fidelity Bank Pic, First Bank Plc Keystone Bank Pic, Union Bank Pic, Globus Bank Plc. Providus Bank Pic, Zenith Bank Pic, United Bank for Africa Pic, and Sterling Bank Plc.

Each bank was fined N150m for non-compliance, in line with the CBN’’s cash distnbution guidelines, followng spot checks on their branches The enforcement action follows repeated wamings from the CBN to financial institutions to guarantee seamless cash availability, particularly during periods of high demand

Communication with the banks revealed that the fines would be debited directly from their accounts with the apex bank

The Acting Director of Corporate Communications at the CBN, Mrs. Hakama Sidi Ali confirmed the development.

She noted that ensuring seamless cashflow is vital for maintaining trust and financial system stability.

According to her, the apex bank would impose further sanctions on any financial institution found hoarding cash in the banking system.

She said, “Each bank was fined N150m for non-compliance, in line with the CBN’s cash distribution guidelines, followng spot checks on their branches.

“The enforcement action follows repeated wamings from the CBN to financial institutions to guarantee seamless cash availability, particularly during periods of high demand

“The affected banks include Fidelity Bank Pic, First Bank Plc Keystone Bank Pic, Union Bank Pic, Globus Bank Plc. Providus Bank Pic, Zenith Bank Pic, United Bank for Africa Pic, and Sterling Bank Plc.

“Communication with the banks revealed that the fines would be debited directly from their accounts with the apex bank

“Ensuring seamless cash flow is paramount to maintaining public trust and economic stability.

“The CBN will not hesitate to impose further sanctions on any institution found violating its cash circulation guidelines.”

The CBN said its investigations and monitoring will continue to scrutinise cash hoarding and rationing, both at bank branches and by Point-of-Sale (POS) operators.

The apex bank said it is working with security agencies to crack down on illegal cash sales and operational violations, including enforcing POS operators’ daily cumulative withdrawal limit of N1.2 million.