Nigerian bank treasurers Wednesday told businessamlive that the were not expecting any major impact from the Federal Government directive to money deposit banks to immediately remit all revenues collected on behalf of the Nigerian Customs Services to the Central Bank of Nigeria (CBN) treasury single account (TSA).
However, money market analysts say the removal of the funds estimated at N536 billion may further put strain on banks liquidity, which may push rates northward.
“The effect of the directive would not be much as most banks sweep the monies to the TSA accounts the next day after collection,” a treasurer in one of the banks said.
But analysts say there is a pervading liquidity crunch in the industry, which the removal directive will compound for small banks, which in order to cover their overnight position, may raise the Nigerian interbank offer rate (NIBOR) further up. NIBOR rates closed 126 percent Monday from 86 the previous week.
The pervading harsh economic conditions exacerbated by recession has put pressure on banks, which have seen deposit thinning amid rising cost of operations.
The banks have also seen their public sector departments winding down due to regulation on treasury single accounts for ministries department and agencies of government. Most of the banks were heavily exposed to the public sector deposit, which saw some shockwaves in the industry a year and half ago.
But treasurers are saying that since the inception and implementation of the TSA, they have practically discountenanced public funds in their strategy planning, that the new directive would do no harm to their positions.
The Senate Committee on Customs, Excise and Tariff gave recent order for banks to remit all Customs funds to the CBN at an investigative meeting with the CBN, Ministry of Finance, Federal Inland Revenue Service (FIRS), Corporate Affairs Commission (CAC), commercial banks and other stakeholders on Tuesday.
Hope Uzodinma, Chairman of the committee, who announced the ultimatum at the meeting, said the senate would involve the Economic and Financial Crimes Commission should the CBN fail to recover the money.