Seven commercial banks in the country are currently in trouble over Treasury Single Account (TSA) that were allegedly kept aside.
A Federal High Court judge has ordered that the sum of $793 million be temporarily remitted to a Federal Government Asset Recovery account.
- The 7 banks include UBA, Diamond bank, Skye Bank, First Bank Limited, Fidelity Bank Plc, Keystone Bank Limited and Sterling Bank
- $367.4 million was allegedly hidden by three government agencies in a UBA account.
- $41 million was kept in a NAPIMS fixed deposit account with Skye Bank.
- $277.9 million was kept with Diamond bank.
- $18.9 million was kept with First Bank
- $24.5 million was kept with Fidelity Bank
- $17 million was kept with Keystone Bank
- $46.5 million was kept with Sterling Bank.
- The funds belong to various federal ministries, parastatals and agencies
- One of the agencies involved is allegedly the Nigerian Petroleum Development Corporation (NPDC)
More money for the government
The alleged recovery will be of great benefit to the government which has a trillion Naira deficit in the 2017 budget. The federal government has had to raise several bond issues to plug the funding gap. Government can spend the funds on critical areas such as infrastructure and education.
What is TSA
Treasury Single Account is a system of government where by all government revenues are paid into one account. The objective of TSA is to approriately capture all government revenues. The TSA policy was instituted by the Goodluck Jonathan administration, but implemented by President Buhari on assumption of office. Implementation of the TSA policy has resulted in the government having access to revenue running into trillions of Naira.
What happens to the banks
If the banks are found guilty of witholding the funds, they may be fined by the Central Bank of Nigeria (CBN). The CBN had earlier fined several banks for failure to hand over TSA funds. Previous fines were quite steep and any possible fines may even be heavier. The CBN in 2015 fined 3 banks N8.8 billion for concealing TSA funds. First bank was fined N1.8 billion, UBA N2.9 billion and Skye bank N4.0 billion. The fines were a fraction of the recovered funds.