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CBN stops treasury bills’ sale to individuals

The Central Bank of Nigeria has given a directive to banks and other finance institutions to stop the sale of treasury bills to individuals and small firms with effect from November 29.

Some bank officials who disclosed this to Punch said only big corporate organisations would be allowed to do treasury bills investments.

Punch correspondents learnt that banks were already notifying their customers of the new directive.

The sources however said the existing treasury bills investments would be allowed to continue till the end of their maturity dates.

A bank official said, “Operators are trying to see if the November 29 deadline given for the implementation by the CBN could be extended, so as to create enough awareness. But there is no move for the reversal of the directive.”

An operator said the inaccessibility of treasury bills might lead to an increase in savings deposits of the banks, attracting interest rates below what the treasury bills offered.

A source from the CBN said the move was to stop the mop-up of funds from the system through the treasury bills.

He said, “Many people with huge cash prefer to keep their funds idle in treasury bills instead of investing the funds. Some people collect huge severance package, have huge funds but they have refused to invest the money.

“We want these funds to be useful in the economy so that they will be available in the banks and can be invested to create more jobs in the country.”

He noted that the CBN had increased the Loan to Deposit Ratio of the banks from 60 per cent to 65 per cent.

 

 

 

– Punch

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About Delia Innoma

Delia Innoma is a prolific writer, promoter, artist manager with full professional proficiency in English, German and Igbo languages. She studied accounting and computer programming at the Institute of Management and Technology Enugu and Germany respectively. Delia is also a devoted mother of two and she founded the Diamond Celebrities Magazine. Her sense of responsibility and commitment to the Christian faith are essential forces driving her daily activities.

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