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CBN begins refund of N500 billion LDR penalties to Banks

CBN has refunded some DMBs that were imposed a cumulative N500bn “penalties” for breaching the it’s directive on lending to the real sector of the economy.



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The Central Bank of Nigeria (CBN) has started refunding the Deposit Money Banks, part of the N500 billion imposed as additional cash reserve for breaching the regulator’s directive on lending to the real sector of the economy.

According to the report by Bloomberg, the refund made by the CBN was confirmed by Ahmad Abdullahi, the Central Bank’s head of banking supervision.

The Details: It was learnt that the CBN has refunded some of the banks from the N500 billion ($1.4 billion) earlier taken as additional cash reserves. It was learnt that most of the banks recently fined by the Central Bank were refunded after meeting the 60% Loan-to-Deposit (LDR) requirement.

Confirming the development, the Chief Financial Officer of the United Bank for Africa Plc, Ugochukwu Nwaghodoh, disclosed that the Bank was refunded N99.7 billion after increased lending.

[READ ALSO: CBN spends N231.2 billion to print banknotes in 6-year, up by 105%]

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Back-Story: As earlier published on Nairametrics, the CBN imposed “penalties” on twelve Nigerian banks for breaching the regulator’s directive on lending to the real sector of the economy. The CBN debited a combined sum of N500 billion from the vault of the banks and will hold the cash at zero percent interest rates.

The following banks couldn’t maintain the LDR and their accounts were purportedly deducted with the following amount;

  • Citibank(N100,743,055, 321)
  • First Bank of Nigeria(N74,668,880,480)
  • FBNQuest Merchant Bank (N2, 697,456,144)
  • First City Monument Bank(FCMB) (N14, 371,064, 742)
  • Guaranty Trust Bank (GT Bank) (N25, 147, 933, 628)
  • Jaiz Bank(N7, 525, 165,552)
  • Keystone Bank(N4, 162, 938, 879)
  • Rand Merchant Bank(N2, 823,177,399)
  • Standard Chartered Bank(N30,027,137,984)
  • SunTrust Bank (N1,703,205,427)
  • United Bank for Africa (UBA) (N99,676,181,916)
  • Zenith Bank (N135,629,337,625).
LDR: Growing the real sector by fiat?

Godwin Emefiele

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Nairametrics had reported that the CBN directed banks to maintain a minimum Loan Deposit Ratio (LDR) of 60% by September 30, 2019. The LDR was reviewed upwards from 58.5% to 60% with the banks informed to maintain the LDR till September ending.

The LDR has now been increased as all DMBs are to now attain a minimum LDR of 65% by December 31, 2019.

In the meantime, the development confirmed the clarifications earlier provided by the CBN. Recall, that reactions trailed the earlier deduction, as reports from a section of the media described the deductions as heavy fine on banks.

[READ ALSO: Lenders increase unsecured loans to households in Q3 2019 – CBN]

However, the CBN quickly clarified that the deductions were only proportionate to the levels of default and banks are not losing the money.

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Mohammed Abdullahi, disclosed at the end of the recent Bankers’ Committee’s meeting:

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“It is wrong to say the deductions are fine because the banks are not losing the money to the CBN. The only implication is (that) the amount debited would not be invested in money market instruments by them. Once the affected banks raise their lending to the deposit threshold, their accounts will automatically be credited.

Samuel is an Analyst with over 5 years experience. Connect with him via his twitter handle

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COVID-19 Update in Nigeria

On the 22nd of October 2020, 138 new confirmed cases and 2 deaths were recorded in Nigeria



The spread of novel Corona Virus Disease (COVID-19) in Nigeria continues to record significant increases as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 61,805 confirmed cases.

On the 22nd of October 2020, 138 new confirmed cases and 2 deaths were recorded in Nigeria, having carried out a total daily test of 4,648 samples across the country.

To date, 61,805 cases have been confirmed, 56,985 cases have been discharged and 1,127 deaths have been recorded in 36 states and the Federal Capital Territory. A total of 595,283 tests have been carried out as of October 22nd, 2020 compared to 590,635 tests a day earlier.

COVID-19 Case Updates- 22nd October 2020,

  • Total Number of Cases – 61,805
  • Total Number Discharged – 56,985
  • Total Deaths – 1,1127
  • Total Tests Carried out – 595,283

According to the NCDC, the 138 new cases were reported from 13 states – Katsina (44), Lagos (35), Kwara (15), Kaduna (13), Plateau (7), Imo (6), Adamawa (5) Rivers (4), Yobe (3), Ogun (2), Oyo (2), Osun (1), FCT (1).

Meanwhile, the latest numbers bring Lagos state total confirmed cases to 20,768, followed by Abuja (5,944), Plateau (3,594), Oyo (3,423), Rivers (2,746), Edo (2,648), Kaduna (2,585), Ogun (1,989), Delta (1,812), Kano (1,741), Ondo (1,659), Enugu (1,314),  Kwara (1,065), Ebonyi (1,049), Katsina (948), Osun (919), Abia (898), Gombe (883).  Borno (745), and Bauchi (710).

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Imo State has recorded 613 cases, Benue (484), Nasarawa (478), Bayelsa (403),  Ekiti (329), Jigawa (325), Akwa Ibom (295), Anambra (277), Niger (274), Adamawa (257), Sokoto (162), Taraba (122), Kebbi (93), Cross River (87), Yobe (82), Zamfara (79), while Kogi state has recorded 5 cases only.

READ ALSO: COVID-19: Western diplomats warn of disease explosion, poor handling by government

Lock Down and Curfew

In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.

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The movement restriction, which was extended by another two-weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.

On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020. Also, on Monday 27th July 2020, the federal government extended the second phase of eased lockdown by an additional one week.

On Thursday, 6th August 2020 the federal government through the secretary to the Government of the Federation (SGF) and Chairman of the Presidential Task Force (PTF) on COVID-19 announced the extension of the second phase of eased lockdown by another four (4) weeks.

READ ALSO: Bill Gates says Trump’s WHO funding suspension is dangerous


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Economy & Politics

Breaking: Senatorial, State House of Assembly bye-elections postponed – INEC

Senatorial and State House of Assembly bye-elections slated to hold on October 31 in 11 states have been postponed by INEC.



Nigeria's election delay

The 6 Senatorial and 9 State House of Assembly bye-elections slated to hold on October 31 in 11 states of the Federation has been postponed by the Independent National Electoral Commission (INEC). The vacancies were as a result of death and resignation of previous members.

According to the statement issued by its National Commissioner & Chairman, Information and Voter Education, Festus Okoye Esq., INEC said the decision was taken after meeting with the 37 Resident Electoral Commissioners (RECs) on Thursday.

Though the commission did not categorically state the reason for the postponement, feelers are that it may not be unconnected with the raging #EndSARS protests across the nation.


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Details shortly…

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#EndSARS: President Buhari issues stern warning to hoodlums

The President has issued a warning to hoodlums who have hijacked the #EndSARS protest to promote unrest.



You are working for Nigeria, not for personal interests, Buhari warns MDAs, This is how much the Federal Government borrowed from Pension Funds in 2019, Increased productivity and higher employment rate required for inclusive growth - IFC , Of visions, plan and budget,FG to review petrol price in April, President Buhari holds National Security Council Meeting with IGP, Defence Minister, VP, and others, President Buhari issues stern warning to hoodlums in his state of the Nation address to Nigerians

President Buhari, in his state of the Nation address to Nigerians this evening has warned hoodlums and the conflict entrepreneurs who have hijacked the #EndSARS protest to promote unrest.

The President explained that the choice to demonstrate peacefully is a fundamental right of citizens as enshrined in Section 40 of the Constitution and other enactments.

“I must warn those who have hijacked and misdirected the initial, genuine and well-intended protest of some of our youths in parts of the country, against the excesses of some members of the now-disbanded Special Anti-Robbery Squad (SARS),” he said.

President Muhammad Buhari frowned against the desperate and inhumane actions of mobsters, arsonists and hoodlums which has led to the loss of human lives, sexual violence, attacks on correctional facilities, as well as public and private properties which were completely destroyed or vandalized.

(READ MORE:#EndSARS: Police officers who participated in abuse of citizens must be fished out – Governors’ Forum)

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He explained that these bad actions will not be tolerated, as it is not in line with the legitimate expression of grievance of the youth of the country. He reiterated that the Government shall continue to ensure that liberty and freedom, as well as the fundamental rights of all citizens, are protected.

What you should know from the President’s State of the Nation address

The President reiterated that the government has the obligation to protect lives and properties, and ensure that the citizens go about their daily businesses freely and protected from acts of violence.

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However, he appealed to protesters to note and take advantage of the various well-thought-out initiatives of this administration designed to make their lives better and more meaningful, and resist the temptation of being used by some subversive elements to cause chaos with the aim of truncating our nascent democracy.

The President, however, warned the youth that doing otherwise will amount to undermining national security as well as law and order, which under no circumstances will be tolerated.

President Buhari thus called on the youths to discontinue the street protests and constructively engage the government in finding solutions, as their voices have been heard loud and clear.

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