The Central Bank of Nigeria (CBN) has unveiled sanctions for Deposit Money Banks participating in the disbursement of the N213bn Nigeria Electricity Market Stabilisation Facility, popularly called power sector intervention fund.
The sanctions were contained in a five-page circular signed by the Director, Financial Policy and Regulations, CBN, Kevin Amugo.
According to he circular, the sanctions grid are put in place to ensure that the banks play according to the terms and conditions guiding the facility.
For various offences that may be committed by the banks participating in the CBN-NEMSF programme, the sanctions range from a penalty of N0.5m to N10m fine and/or termination of the DMB’s participation as a mandate bank.
The infractions listed on the circular include:
Failure by the DMB to provide statement of accounts maintained by the electricity distribution companies to the refinancer/administrator
Allowing revenue to be paid into a bank accounts different from the Feeder Collection Accounts
Allowing withdrawals or debits from the Feeder Collection Account by a non-Principal Collection Account.
The CBN had through the DMBs disbursed billions of naira from the N213bn power intervention fund to several power firms.
The funds were disbursed to DISCOS, GENCOS and other allied companies in the electricity value chain.
Earlier this year, some power firms were presented with cheques at the CBN office in Lagos.
Six companies, comprising three DISCOs and three GENCOs, had last year received N39bn cheque at the CBN corporate headquarters in Abuja.
The CBN Governor, Mr. Godwin Emefiele, had during the event, reminded beneficiaries that the facility, which would be repaid within a 10-year period, was to enable them address challenges militating against electricity power generation and distribution.