CBN to stop treasury bill sale to individuals and start-ups

THE Central Bank of Nigeria has issued a directive to banks and other financial institutions to halt the sale of treasury bills to individuals and small firms.

According to the Punch, the development was a move to stop the mop-up of funds from the system through the treasury bills.

“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,” a CBN source revealed to the paper.

This latest move by the CBN would mean that only big corporate organisations that would be allowed to do treasury bills investments




    The unavailability of treasury bills is expected to lead to an increase in savings deposits of the banks attracting interest rates below what the treasury bills offered.

    Nevertheless, existing Treasury bills investments would be allowed to continue until the end of their maturity dates.

    The directive which is yet to be published by the apex bank is expected to come into effect from November 29. Although, there is stipulations that the date might be moved to a future date for proper public sensitisation.

    A Treasury Bill is a short-term debt obligation backed by the Treasury Department with a maturity of one year or less.

     

     

    Join the ICIR WhatsApp channel for in-depth reports on the economy, politics and governance, and investigative reports.

    Support the ICIR

    We invite you to support us to continue the work we do.

    Your support will strengthen journalism in Nigeria and help sustain our democracy.

    If you or someone you know has a lead, tip or personal experience about this report, our WhatsApp line is open and confidential for a conversation

    LEAVE A REPLY

    Please enter your comment!
    Please enter your name here


    Support the ICIR

    We need your support to produce excellent journalism at all times.

    -Advertisement-

    Most read