CBN introduces new policy on dormant accounts http://www.punchng.com/business/money/cbn-introduces-new-policy-on...

August 18th, 2015

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CBN introduces new policy on dormant accounts Most Read Recent Comments Most Commented

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The Central Bank of Nigeria has introduced
new guidelines for the treatment and Court officials storm finance
management of dormant account balances ministry to enforce judgment
by deposit-taking financial institutions.
Naira rises to 217 against dollar
Part of the objectives of the policy,
according to the CBN, is to ensure that
dormant account funds are identified and
channelled through appropriate institutions
to make them more productive to the
economy and eliminate the possibility of
banks converting dormant account balances
CBN Governor, Mr. Godwin Emefiele to income.

The bank, in a circular released signed by its Director, Financial Policy and Regulation Department, Mr. Kevin
Amugo, on Tuesday, stated that the absence of clear guidelines for the management of dormant accounts had
resulted in the disproportionate treatment of such account balances by deposit-taking financial institutions. Online crew diary

This, it noted, was generating concern among bank account holders, regulators and other stakeholders.

It said representations received by the CBN from stakeholders on the subject highlighted the need for the bank
to develop a regulatory framework for the management of dormant accounts for the benefit of the banking
system and the Nigerian economy.

The directive stated, It is in view of the above and the imperative to promote transparency in the financial
system that the CBN hereby issues these guidelines to provide a standard for the treatment and management
of dormant account balances in Nigeria.

Oonis burial in pictures

The purpose of the policy is to curb possible abuse in the operation of dormant accounts, set operational
standards for banks and other financial institutions in line with best practice, and to reinforce the property rights
as guaranteed in the 1999 Constitution of the Federal Republic of Nigeria (as amended). More Posts...

A dormant account shall be a bank account that has no customer or depositor originated transaction within a
specified period of six years after the last customer or depositor initiated a transaction. However, such an
account shall be recognised as inactive after the first six months of non-depositor or customer originated
transaction in it.

The CBN also said, Accounts shall retain their interest earning status during the period of dormancy in the
bank. Deposit-taking financial institutions shall continue to monitor accounts that show tendencies of inactivity
and where necessary, initiate actions for their activation or protection from wrong usage.

Once dormant accounts exceed a six-year period, they shall be reported to the CBN along with efforts made
by the obligor bank to locate the owners or their personal representatives.

The CBN stated that three months to the end of the six years, both the account holder and the next-of-kin

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CBN introduces new policy on dormant accounts http://www.punchng.com/business/money/cbn-introduces-new-policy-on...

would be notified, adding that revalidation of inactive/dormant accounts would not attract any charge to the
account holder as the banks would have made ample use of the idle funds.

It said, Dormant account balances shall continue to be reflected in the books of banks as deposit liabilities until
they are eventually withdrawn by the account holders or disposed of on their instructions. Dormant account
balances shall, therefore, be regarded as deposits and shall be covered by deposit insurance.

In the case of government-owned inactive/dormant accounts, banks shall notify the relevant government
agency of their existence, with periodic returns of such notification sent to Banking Supervision Department.
Banks are also required to turn over the funds to the concerned treasury after six years of inactivity.

The bank said account opening forms would include the provision of next-of-kin, who would be contacted at the
point of declaring the accounts dormant.

The provisions of the guidelines shall take immediate effect. Sanctions for contravention of the provisions of
the guidelines shall be imposed under Section 60 of the BOFIA (1991) as amended, the CBN said.

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Contact: editor@punchng.com

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Columnists

Oba Okunade Sijuwade,

Olubuse II, 1930-2015
Olofin Oduduwa. Iku Baba
Yeye. Iku Alase,Ekeji Orisa.
Orisa gbogbo Oba Yoruba.
Oba Olori Alade. Jingbinni bi
ate akun. Ekun
Read More

We should not only recover stolen public funds

from corrupt people, they should also be
banned from holding public office. Whatever the
EFCC and the ICPC have done so far is
commendable, but we need to sanction the
culprits by naming and shaming them."

The Executive Director, Civil Societies Legislative

and Advocacy Centre, Auwual Musa-Rafsanjani,
saying the anti-graft crusade of the ICPC
commendable.

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CBN introduces new policy on dormant accounts http://www.punchng.com/business/money/cbn-introduces-new-policy-on...

26 Comments 1

disqus_5im86Y8yEJ

will that make naira to dollar to go back to 156 naira????

Shahokaya

Vote out this clueless regime led by once a shoeless dumbo.

Find cars for you

Any Make
Izedomi Ohirein

N208bn from some ghosts workers at Abuja just reported by Finance Minister.
Any Model
"That is a tip of the iceberg". J
Just imagine if those who have been collecting that money + Oil subsidy & Min Price Max Price
contract scams are disposed off all their assets [as stolen goods] as they do in
many Counties. SEARCH
Only Buhari could do such a thing, not corrupt, wasteful & incompetent
Jonathan. Rover 600
Please vote for change. Lagos - 350,000

aisha ani

For where, you know in Nigeria what goes up will never come down. Peugeot 406
Lagos - 1,250,000 - Price
Negotiable

disqus_5im86Y8yEJ Business & Economy

Ha!! walala dey o...

Asiwaju OKA

6 years window period is not good enough. i believe there should be proceeds attached
to such funds bearing in mind that the banks must have used the money in discuss for
transaction during the period.

Juungle Man Experts canvass gas master

You said it all. There are too many dormant accounts in Nigeria. The banks are plan review, licensing round
the ones gaining from it. A period of 2yrs is ok

Eze1

Emefiele is that your priority, dormant account?

kennedy

This is a very wrong policy Mr. Governor, and it's indirect way of embezzlement. For
individuals money to go to government purse is inappropriate bcos it'll serve nothing.
And again you have given the period of dormancy which is very short but you failed to
give a solution if the owner/transactor returns to his account. I believe dormant account
are subject to reactivation so why your rule s so rigid?

Salisu

Kennedy, please read the article again. There was no place where it was stated
that individuals' funds shall got to government account. They only stated that
funds belonging to government parastatals shall be returned to their treasuries
after six years. Thank you.

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