Harsh Times Beckon For Nigerian Banks As MDAs Close Accounts

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The Nigerian government, Ministries, Departments and Agencies (MDAs), would this weekend be closing their accounts domiciled with Deposit Money Banks (DMBs) as issued by the Federal Government, according to reports by BusinessDay.

“You are advised to commence the process of closing all revenue collection account with commercial banks and transfer all available balance to the Central Bank of Nigeria (CBN),” Jonah Otunla, accountant-general of the Federation, said at a workshop on the Federal Government revenue e-collection project in Abuja, last week.

It would be recalled that, early January, the Federal Government issued a directive to government MDAs to close their revenue collection accounts domiciled in the DMBs.

Consequently, the MDAs were given up to February 28, to formalise with the accountant-general of the Federation on how these accounts will be operated as appropriate sanction would be applied against any MDA that fails to comply.

Further reports claim that Lagos State branch of the Chartered Institute of Bankers of Nigeria (CIBN), Chairman, Bolade Agbola disclosed on Monday that the directives of the FG was aimed at controlling money supply.

According to Mr Agbola, by the time the MDAs pull out their funds, banks will not be able to make profit the way they used to, their margins will shrink, so many loans will go bad and provision for loan loss will increase.



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