Polaris Bank fined N10bn over failure to meet 27.5 per cent CRR obligation

Polaris Bank Limited has been fined by the Central Bank of Nigeria (CBN) for failing to meet its 27.5 per cent Cash Reserve Requirement (CRR) obligation.

The CRR rule empowers the Central Bank to hold up to 27.5 per cent of customer deposits held by commercial banks, restricting the banks from accessing the money.

Cash Reserve Ratio was set as 27.5 % in Apr 2021

IDOMA VOICE reports the debit, which occurred last Friday, has left many stakeholders in the banking sector very upset as the apex bank recently suspended debiting banks for not meeting the requirement.

The last time CBN debited 16 banks and two merchant banks N175 billion was mid-December 2021.

The breakdown of some affected banks revealed that, Polaris Bank was debited N10 billion.

Polaris Bank is led Innocent C. Ike, the Managing Director/Chief Executive Officer.

Others affected were, Zenith bank-N90 billion, Access bank-N25 billion, Unity Bank Plc- N500 million, FCMB Limited- N5 billion, and Stanbic Bank- N4 billion and UBA- N25billion.

The CBN had on December 8, 2021 debited seven banks and two merchant banks a sum of N29.6 billion.Analysts believe cash reserves are historically between 5 per cent and 10 per cent of LCY deposits.