Central BANK OF Nigeria, CBN has come up with a sanctions grid for any participating deposit money bank that violates regulatory guidelines of the N213bn Nigeria Electricity Market Stabilisation Facility, popularly called power sector intervention fund.
This was contained in a circular to banks signed by the Director Financial Policy and Regulatory Department of the CBN, Mr. Kevin Amugo yesterday.
The CBN had through the DMBs disbursed billions of naira from the N213bn power intervention fund to several power firms. The funds were disbursed to DISCOS, GENCOS and other allied companies in the electricity value chain.
Earlier this year, some power firms were presented with cheques at the CBN office in Lagos.
Six companies, comprising three DISCOs and three GENCOs, had last year received N39bn cheque at the CBN corporate headquarters in Abuja.
According to him, when a Collection Bank and the Principal Collection Bank fail to provide the Refinancer/Administrator with statements of accounts for the Transaction Accounts within five Business Days after the end of each month a warning letter to the DMB instructing that the infraction must be remedied within two working days will be issued to them.
When further infractions are noticed a financial penalty of a minimum of NGN 500,000 daily until the infraction is remedied on each account that such infraction is committed.
However, if there is a further infraction by the DMB after payment of the above financial penalty, the DMB’s participation as a Mandate Bank under the CBN-NEMSF shall be terminated.
Also when DMB does not comply with a request by the Refinancer/Administrator to provide copies of bank statements for any of the Discos Accounts maintained by it and such other information relating to the transactions effected or to be effected on the Transaction Accounts within five Business Days from date of such request, it will attract a warning letter to be issued to the DMB instructing that the infraction must be remedied within two working days. CBN will be notified of the infraction. Failure to comply within two working will attract a financial penalty of a minimum of NGN 500,000 daily until the infraction is remedied.
Also if there is a further infraction by the DMB after payment of the above financial penalty, the DMB’s participation as a Mandate Bank under the CBN-NEMSF shall be terminated.
Where Collection Banks allow revenues including cash collections and revenues received from all electronic or other platforms generated by any DISCO to be paid directly in any account other than the Feeder Collection Accounts as stipulated in the Account Administration Agreement the apex bank explained that warning letter would be issued to the DMB instructing that the infraction must be remedied within two working days, and a minimum financial penalty of NGN 500,000 daily on each account that such infraction. If there is a further infraction by the DMB after payment of the above financial penalty, the DMB’s participation as a Mandate Bank under the CBN-NEMSF shall be terminated.


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