Revealed: What CBN wants to do with funds left in dormant accounts

3 months ago 5

The Central Bank of Nigeria (CBN) has announced plans to take over funds left in dormant accounts in banks and other financial institutions
The CBN said that the funds would be invested in treasury bills and other securities
It also said that it would establish procedures for reclaiming the funds and publish the names of the owners on its website annually

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

The Central Bank of Nigeria (CBN) has issued a new directive to Nigerian financial institutions regarding dormant accounts.

The new directives disclose that the CBN will take over the funds left in the accounts and invest them in treasury bills and other securities.

CBN to invest the funds in T-Bills

According to the circular issued on Friday, July 19, 2024, and signed by the bank’s Ag Director of Financial Policy and Regulation Department, John Onojah, the bank disclosed that it shall open and maintain an account meant for warehousing unclaimed balances in banks and other financial institutions in Nigeria.

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The circular reads:

“CBN shall treat unclaimed balances (dormant accounts and financial assets) as follows: Open and maintain an Unclaimed Balances Trust Fund (UBTF) Pool Account’, maintain records of the beneficiaries of the unclaimed balances warehoused in the UBTF Pool Account; invest the funds in Nigerian treasury bills (NTBs) and other securities as may be approved by the ‘Unclaimed Balances Management Committee’. “Refund the principal and interest (if any) on the invested funds to the beneficiaries not later than ten (10) working days from the date of receipt of the request. Where it is imperative to extend the timeline, a notice of extension shall be communicated to the requesting FI stating reasons for the extension,” the circular stated.

CBN to publish names of owners of accounts

According to reports, the apex bank disclosed that it will establish standard procedures for reclaiming warehoused funds and resolve escalated complaints regarding reclaiming the funds.

Per the circular, CBN will also be responsible for publishing on its website the list of the owners of the unclaimed balances that have been transferred to the UBTF Pool Account and the procedure for reclaiming warehoused funds and other financial assets.

Reports say CBN directed banks and financial institutions to deposit unclaimed balances and funds in dormant accounts in its accounts.

The Central Bank of Nigeria (CBN) has directed banks and other financial institutions to deposit unclaimed balances and funds in dormant accounts to the apex bank accounts.

It also issued a temporary guidelines for account owners and beneficiaries to recover their dormant funds left for about 10 years.

A dormant account is a bank account that has remained inactive for at least one year.

Legit.ng reported that the CBN unveiled the draft stage for the guideline in April.

CBN to make changes on iInterest rates on savings accounts

Legit.ng reported that the governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has said the bank would extend its monetary tightening position to control inflation.

The CBN boss said this in a recently published debut outlook, stating that the move is to mitigate some risks and address existing imbalances.

Some of the risks he cited included heightened inflation due to long-standing structural imbalances, which would extend monetary tightening and depressed growth forecasts.

Source: Legit.ng

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