TSA: Skye Bank in Talks with CBN, Seeks Review of N4bn Fine…

Skye Bank Plc said it had commenced engagement with the Central Bank of Nigeria over the N4 billion fine imposed on it for concealing funds belonging Ministries, Departments and Agencies (MDAs) in contravention of the directive on Treasury Single Account (TSA).

In a notification to the Nigerian Stock Exchange (NSE) dated November 9, 2015 which was jointly signed by the Group Managing Director of Skye Bank, Mr. Timothy Oguntayo, and Company Secretary, Abimbola Izu, the bank said the fine imposed by the apex bank was misdirected since it did not conceal any information on it accounts.

Quoting a CBN circular addressed to the Chairman, Board of Directors of Skye Bank, THISDAY had exclusively reported in it Sunday edition that a fine of N4,005,228,976.35 had been imposed on the bank for failing to report MDAs’ balances amounting to N40,052,289,769.47, as at October 23, 2015 - more than a month after the TSA deadline had expired.

The N4billion fine, which represents 10 percent of the concealed funds belonging to Federal Government MDAs, the circular said, would be debited from Skye Bank’s current account with the CBN.

But in its statement yesterday, Skye Bank said significant portion of the money for which penalty was applied belonged to the state-owned energy company Nigerian National Petroleum Corporation (NNPC) pension funds and National Assembly legislative aides account balances.

The bank added that the sum of N40 billion for which the fine was imposed on it came from NNPC account balances, claiming it had received a communication from the corporation excepting it from the treasury single account (TSA) operations.

“We received a communication from the NNPC forwarding a letter from the Accountant General of the Federation on the treatment of NNPC funds. By the communication, the bank is advised that an 18 business day window had been granted by the vice-president, Yemi Osinbajo, within which a plan for the orderly withdrawal of the NNPC funds will be implemented,” the bank explained.

Skye Bank told the NSE that it had commenced engagement with the apex bank with a view to bringing the issues to the attention of the banking sector regulator and seeking a review of the penalty.

The Federal Government had directed that balances/receipts due to the government or its agencies be paid into a TSA domiciled in the CBN except otherwise expressly approved. The TSA is a bank account or a set of linked bank accounts through which the government transacts all its receipts and payments and gets a consolidated view of its cash position at any given time. A September 15 deadline was given for full compliance with the directive.

CBN hammer had earlier fallen on two major banks - First Bank of Nigeria Limited (FirstBank) and United Bank for Africa (UBA) Plc for failing to comply with the directive on TSA. While a fine of N1,877,409,905.12 was imposed on FirstBank, UBA was fined N2,942,189,651.45. The fines represented 5 per cent of the unremitted funds.

While notifying Skye Bank of the fine, the apex bank’s circular signed by the Governor, Mr. Godwin Emefiele, had noted an October 14, 2015 request by its Director of Banking Supervision, Mrs. Tokunbo Martins, for information on Skye Bank’s total amount remitted and unremitted to TSA in a prescribed format with a submission deadline of 12pm, October 15, 2015.

CBN however stated that the bank’s initial submission on “15th October 2015 in respect of the information requested indicated unremitted amount of N442, 916,642.92, a rendition which was false as your bank failed to report FGN MDAs’ balances amounting to N40,052,289,769.47 as at 23rd October 2015.”

The unreported sum, it said, was unearthed during CBN examiners’ onsite visit to Skye Bank on October 26, thereby aggravating the offence.