UBA Plc has issued a press release confirming that it was fined N2.8 billion by the CBN for failing to remit a sum of N58.8 billion of the government funds to the Treasury Single Account (TSA). The amount represents about 5% of the sum not remitted and would have been avoided had the bank met the deadline of October 15.
This is a pure operational lax from the management of the bank and we will be surprised if someone in the bank fails to take the fall for this huge gaffe. Using the latest 9 Months results, N2.9 billion is about 5% of the banks pre-tax profits or 1% of Gross Earnings. The amount is also about 77% of the about N3.6 billion dividends it paid on the 27th of April this year (assuming 36.2 billion shares). UBA paid a further interim dividend of N7.2 billion this year taking its total dividend payout this year to about N10.8 billion. Thus this fine will cost the company about 26% of total dividend paid.