Business
CBN directs banks to deposit unclaimed balances, funds in dormant 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.
CBN also issued regulatory guidelines for account owners and beneficial owners to recover their funds dormant for up to 10 years.
The apex bank outlined the regulations in a document on Friday titled ‘Guidelines on Management of Dormant Account, Accounts, Unclaimed Balances and Other Financial Assets In Banks And Other Financial Institutions in Nigeria’.
A dormant account is a bank account that has remained inactive for at least one year.
The apex bank said the revised guidelines are a sequel to the conclusion of the review of the guidelines on the management of dormant accounts issued in October 2015.
“The revised Guidelines, which operationalizes Section 72 of the Banks and Other Financial Institutions Act (BOFIA) 2020, followed engagement and consultations with relevant stakeholders, whose comments and recommendations were considered in the review process,” CBN said.
“It, amongst others, standardises the management of dormant accounts, unclaimed balances and financial assets, and outlines the procedure for the administration of these balances, funds, and assets by banks and other financial institutions in Nigeria.
“The modalities for the transfer of the relevant balances/funds/assets to the CBN, together with the revised templates for the rendition of quarterly returns to Banking Supervision Department or Other Financial Institutions Supervision Department (as the case may be) will be communicated subsequently.”
The financial regulator further said the guidelines supersede the previous guidelines, adding that they take effect immediately.
REUNITING FUNDS FOR BENEFICIAL OWNERS
In the document, CBN said the objectives of the guidelines are to “identify dormant accounts/unclaimed balances and financial assets with a view to reuniting them with their beneficial owners”.
“Hold the funds in trust for the beneficial owners; Standardize the management of dormant accounts/unclaimed balances and financial assets,” the apex bank said.
“Establish a standard procedure for reclaim of warehoused.”
10 YEARS DORMANCY
According to the financial regulator, eligible accounts are dormant account balances that have remained with the institution for 10 years and beyond.
“Eligible dormant accounts/unclaimed balances and other financial assets shall include: Current, Savings and term deposits in local currency,” CBN added.
“Domiciliary accounts; deposits towards the purchase of shares and mutual investments; Prepaid card accounts and wallets; Government owned 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.
CBN also issued regulatory guidelines for account owners and beneficial owners to recover their funds dormant for up to 10 years.
The apex bank outlined the regulations in a document on Friday titled ‘Guidelines on Management of Dormant Account, Accounts, Unclaimed Balances and Other Financial Assets In Banks And Other Financial Institutions in Nigeria’.
A dormant account is a bank account that has remained inactive for at least one year.
The apex bank said the revised guidelines are a sequel to the conclusion of the review of the guidelines on the management of dormant accounts issued in October 2015.
“The revised Guidelines, which operationalizes Section 72 of the Banks and Other Financial Institutions Act (BOFIA) 2020, followed engagement and consultations with relevant stakeholders, whose comments and recommendations were considered in the review process,” CBN said.
“It, amongst others, standardises the management of dormant accounts, unclaimed balances and financial assets, and outlines the procedure for the administration of these balances, funds, and assets by banks and other financial institutions in Nigeria.
“The modalities for the transfer of the relevant balances/funds/assets to the CBN, together with the revised templates for the rendition of quarterly returns to Banking Supervision Department or Other Financial Institutions Supervision Department (as the case may be) will be communicated subsequently.”
The financial regulator further said the guidelines supersede the previous guidelines, adding that they take effect immediately.
REUNITING FUNDS FOR BENEFICIAL OWNERS
In the document, CBN said the objectives of the guidelines are to “identify dormant accounts/unclaimed balances and financial assets with a view to reuniting them with their beneficial owners”.
“Hold the funds in trust for the beneficial owners; Standardize the management of dormant accounts/unclaimed balances and financial assets,” the apex bank said.
“Establish a standard procedure for reclaim of warehoused.”
10 YEARS DORMANCY
According to the financial regulator, eligible accounts are dormant account balances that have remained with the institution for 10 years and beyond.
“Eligible dormant accounts/unclaimed balances and other financial assets shall include: Current, Savings and term deposits in local currency,” CBN added.
“Domiciliary accounts; deposits towards the purchase of shares and mutual investments; Prepaid card accounts and wallets; Government owned accounts;
“Proceeds of uncleared and unpresented financial instruments belonging to customers or non-customers of FIs.”
Furthermore, the CBN said it will open and maintain an account earmarked for the purpose of warehousing unclaimed balances in eligible accounts.
The account shall be called the ‘Unclaimed Balances Trust Fund (UBTF) Pool Account’.
In addition, the CBN shall establish a management committee to oversee the operation of the UBTF pool account, monitor and enforce compliance with these guidelines; and manage the funds in line with the provisions of BOFIA 2020;
Other stakeholders of the unclaimed accounts are the Nigeria Deposit Insurance Corporation (NDIC) and financial institutions.
REACTIVATION, UNCLAIMED FUNDS
To reactivate a dormant account, CBN said the account owner or beneficial owner must complete a reactivation form in person.
“Obtain from the account owner evidence of ownership of the dormant account with valid means of identification, evidence of present place of residence, and affidavit on the accuracy of the information to reactivate the dormant account,” the apex bank said.
“Verify the information provided on the reactivation form; Not charge any fee for reactivation of dormant account.
“Reactivate the dormant account with the approval of two (2) authorized officers with one being at least the branch operations manager.
“Reactivate dormant accounts within a maximum of three (3) working days of receipt of a written application to that effect.
“Notify the account owner, free of charge, upon reactivation of the account.”
Also, to access the list of unclaimed balances transferred to CBN on the websites, the account owner/beneficial owner shall provide evidence of account ownership, valid means of identification, evidence of the present place of residence, and an affidavit on the accuracy of the information to reactivate the account.
“The profit and loss ratio on the unclaimed balances for non-interest banks shall be determined by the CBN from time to time;
“The FIs shall verify the claim and initiate the request with supporting documents to CBN within ten (10) working days;
“Application for reclaim shall be to the director banking services department, CBN;
“CBN shall refund unclaimed balance to the account owners/beneficial owners through their FIs within ten (10) working days from the date of the receipt of the FI’s request.
“Beneficial owners shall not make partial claims; and the right of beneficial owners to reclaim shall be indefinite.”
CBN said monitoring and enforcement of banks and financial institutions will be through off-site surveillance as well as on-site routine and target examinations.
Business
UBA appoints Henrietta Ugboh as independent non-executive director
The United Bank for Africa Plc (UBA) has announced the appointment of Henrietta Ugboh as an independent non-executive director.
In a statement on Wednesday, UBA said the appointment has been approved by the necessary regulatory bodies, including the Central Bank of Nigeria (CBN).
UBA also announced the retirement of Owanari Duke, an independent non-executive director who joined the UBA Group board in October 2012.
Tony Elumelu, chairman of UBA, said Ugboh brings experience and expertise, which includes commercial banking, credit, and risk management to the UBA board.
“Henrietta Ugboh brings a track record of professional success, integrity and leadership, which will further strengthen the UBA Group Board, underlining once again the Group’s commitment to robust corporate governance,” Elumelu said.
According to the bank, Ugboh holds a degree in Economics and Statistics from the University of Benin, an MBA from ESUT Business School, and is an alumna of Harvard Business School’s executive management programme.
UBA also said Ugboh has over 30 years of experience in banking with Citibank and is an honorary senior member of the Chartered Institute of Bankers of Nigeria (CIBN) and a fellow of the Institute of Credit Administration (FICA).
Business
MultiChoice Nigeria loses 243k subscribers in six months, blames inflation
Multichoice Group, an African pay-TV operator, says its Nigerian subsidiary lost 243,000 subscribers across its DStv and GOtv services between April and September 2024.
In its financial result for the year ended September 30, 2024, published on Tuesday, MultiChoice said high cost of food, electricity, and petrol have forced many of its customers to ditch their decoders.
The company said Nigeria and Zambia recorded the largest share of subscribers loss.
It added that the pressure on its subscriber base in Rest of Africa (RoA) operations continued from the previous year leading to a loss of 566,000 subscribers across the operations in the six months under review.
“The group’s linear subscriber base declined by 11% or 1.8m subscribers YoY to 14.9m active subscribers at 30 September 2024,” MultiChoice said.
“The loss in the Rest of Africa has been primarily due to the significant consumer pressure in Nigeria, where inflation has remained above 30% for the majority of the last 12 months and, more recently, due to extreme power disruptions in Zambia.
“Of this decline, 298k related to Zambia and 243k related to Nigeria, with remaining markets on the continent reflecting only a minor decline of 25k.”
On foreign exchange (FX) rate, the company said the continued depreciation of the naira against the dollar has resulted in further losses on non-quasi equity loans.
“The group held USD11m in cash in Nigeria at period-end, down from USD39m at end FY24, a consequence of consistent focus on remitting
cash, the impact of translating the balance at the weaker naira and the write-off of the USD21m receivable relating to the cash held with Heritage Bank before its license was revoked and the bank was liquidated,” MultiChoice said.
‘COMPANY FACING MOST CHALLENGING CONDITIONS’
Commenting on the company’s results, Calvo Mawela, MultiChoice group chief executive officer (CEO), said the company is facing its most challenging operating conditions in almost 40 years.
To generate returns, Mawela said the company has been “proactive in its focus to right-size the business for the current economic realities and industry changes”.
He said while operating across Africa “typically subjects the group to currency moves, abnormal currency weakness over the past 18 months has reduced the group’s profits by close to R7 billion”.
“Combined with the impact of a weak macro environment on consumers’ disposable income and therefore on subscriber growth, it required the Group to fundamentally adjust its cost base – which is exactly what has been done,” he said.
“We are making good progress in addressing the technical insolvency that resulted from non-cash accounting entries at the end of the last financial year.
“We expect to return to a positive net equity position by the end of November this year, supported by a number of developments and initiatives. The Group’s liquidity position remains strong, with over ZAR10bn in total available funds.”
On May 1, MultiChoice implemented an increase in subscription prices for DStv and GOtv packages — despite the tribunal ruling against it on April 25.
Business
NCAA to sanction pilots working for multiple airlines, says it ‘violates regulations’
The Nigeria Civil Aviation Authority (NCAA) says it will sanction pilots working for multiple airlines.
In a letter dated November 6, 2024, and addressed to all aircraft operators, titled ‘Prohibition of Ad-Hoc Flight Operations for Multiple Airlines,’ Chris Najomo, the NCAA acting director-general (DG), said the issue was uncovered through the aviation authority’s surveillance reports.
“It has come to the notice of the authority through our surveillance reports that licensed flight crew members utilize the privileges simulators and proficiency checks endorsed on their license to operate for multiple airlines,” the letter reads.
“The Flight Simulator Training Device/facility approved by the Authority is operator specific based on the training program and the Standard Operating Procedures (SOP) for such an operator.”
According to Najomo, when pilots work for multiple airlines concurrently, without considering the safety implications, it creates a risk for the industry.
He informed all operators and holders of pilot licences that the action will be treated as a violation of the Nigeria Civil Aviation Regulations.
“The authority will take appropriate enforcement action on violators of this directive, effective from November 11, 2024,” he said.
The acting DG added that simulator renewals will now be directly tied to the operators.
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