Banks Move To Limit Over-The-Counter Withdrawals To N10,000

Customers of Deposit Money Banks, DMBs, may
be faced with a new across-the counter cash
withdrawal limit to be pegged at N10, 000. It
was learned,weekend, that the DMBs, under the
aegis of the Bankers Committee, have already
approached the Central Bank of Nigeria, CBN, to
propose the limit.
Sources said the measure being contemplated
would drastically reduce the number of
customers that would need to physically visit
banking halls for transactions.
The DMBs, sources said, wanted to achieve two
objectives via this strategy, if approved by the
CBN. The objectives include greater use of
electronic banking and smaller workforce – as a
means of cutting cost of operations. Already,
some banks had laid off many workers, citing
operational losses, especially as the Federal
Government Treasury Single Account Policy,
TSA, has deprived them of federal government
deposits.
It took the intervention of the Federal
Government, which even had to threaten banks
with severe sanctions, including the withdrawal
of their licences, to pull back on the gale of
mass sack. A ‘State of the Economy’ document
of the apex bank presented to the Bankers’
Committee in Abuja, last Thursday, showed that
unaudited Profit Before Tax of banks for the
period ended April 2016 indicated a decrease
from N222 billion in April last year to N198
billion, representing a 10.8 per cent or N24 billion
decrease.
“The decline was driven largely by a decrease in
both interest and non-interests income which
decline by 6 per cent or N50 billion and 54 per
cent of N259 billion, respectively,” the document
read.
It explained that the banking sector was still
faced with a lot of pressure points, some of
which it listed as resurgence of inflationary
pressures in the face of negative output growth,
continuing low oil prices, and lack of fiscal
buffers.
In addition, the apex bank said capital flow
reversals, rising pressure on exchange rate in the
face of declining external reserves, huge growth
in credit to the government to compensate for
declining oil receipts were other major
challenges confronting the industry.