Nigeria’s central bank has suspended nine commercial banks from all foreign exchange transactions and operations after they failed to transfer $2.1bn (£1.6bn) of dividends from the state-owned gas company to the government, Reuters news agency reports.
Last year, President Muhammadu Buhari ordered the merger of state accounts into one single account at the central bank to reduce corruption.
What lies behind Nigeria’s decision to suspend foreign exchange trading at nine banks?
The government of President Muhammadu Buhari established a Single Treasury Account last year and asked all state agencies and departments to transfer revenues to that account, as part of an anti-corruption drive.
Many commercial banks have suffered as a result of the policy, after government agencies stopped depositing their money with them in compliance with the directive.
The nine banks named will have to remit the missing $2.1bn (£1.6bn) to the government before they are allowed to resume foreign exchange trading.
One source at the Central Bank of Nigeria tells me that this will have a major impact on some of the affected banks’ operations.
The central bank is also expected to impose fines on the banks for the failed payments.
Customers of these banks will definitely be affected, especially those who have foreign currency accounts.
The bigger question, according to the source, should be: Why are these banks holding this money? Are they doing it in connivance with the national oil company NNPC, which stands accused of failing to remit billions of dollars of revenues to the government in recent years, or is there a more innocent explanation?
This can only be determined after a proper investigation, the source says.
However, an NNPC spokesman told me that the ban was triggered after it submitted a complaint to President Buhari, asking him to intervene and compel the banks to remit the money.