Central Bank of Nigeria (CBN) has directed the transfer of funds in dormant accounts – for a period of up to 10 years – into a Trust Fund account, which will would then be invested in Treasury Bills.
According to a circular accompanying an exposure draft from the apex bank, the new guideline is in response to requests from banks and other stakeholders for the CBN to clarify the procedures for the management of dormant and inactive accounts by banks in the country.
The new development is contained in the exposure draft of guidelines on the ‘Management of Dormant Accounts, Unclaimed Balances and Other Financial Assets in Banks and Other Financial Institutions in Nigeria’. The circular was signed by CBN director of financial policy and regulation department of the apex bank, Chibuzor Efobi.
The CBN is now calling for inputs from stakeholders which should be sent within three weeks.
They are to “continue to reflect dormant account balances as deposit liabilities and such balances, where applicable, shall continue to earn interest until they are transferred to CBN.
“Maintain a register for funds transferred to CBN for reclaim and audit trail. Publish, on their websites, details of all dormant accounts, six months prior to their eligibility for transfer to CBN. However, other financial institutions (OFIs) without websites shall publish same on their Association’s website.
“Publish the list of dormant accounts holders in at least two national daily newspapers, except for unit microfinance banks, which shall publish in their premises. Information to be published shall include the name, address of the branch, and next-of-kin of account holder. It should also be stated that the account has been transferred to the register of dormant account.
Banks and other financial institutions are expected to transfer all unclaimed balances in accounts that have been dormant for up to 10 years into an Unclaimed Balances Trust Fund (UBTF) pool account which will be domiciled at the CBN.
The banks are also expected to transfer unclaimed balances quarterly, not later than 15 days of the first month of the subsequent quarter; and retain all records of communication on the management of dormant accounts for a minimum of 10 years.
Banks and OFIs, by the guideline are to “maintain records of the beneficiaries of the unclaimed balances warehoused in the UBTF Pool Account; invest the funds in Nigerian Treasury Bills (NTBs) and other securities as may be approved by the ‘Unclaimed Balances Management Committee’; and refund the unclaimed funds to the beneficiaries not later than 10 working days from the date of receipt of the request.”
The exposure draft notes that banks including other financial institutions are saddled with the responsibility of contacting account holders whose account are dormant and are also required to publish the list of dormant accounts on their website.
