Investors Panic on Bank Suspension, DisCos Complain of Power Supply

electricity-industry (1)

Investors dumped shares in Nigerian banks on Wednesday, a day after the CBN suspended nine lenders from foreign exchange transactions for failing to remit money owed to the government. FCMB, First Bank, UBA, Heritage Bank, Keystone Bank, Skye Bank, Diamond Bank, Sterling Bank, and Fidelity Bank for withholding government dollars from the national treasury. Shares in Diamond Bank plummeted the most, shedding 7.32 percent in early trading, followed by Sterling which was down 3.88 percent. FCMB fell 2.5 percent, First Bank shed 1.5 percent, while Skye Bank was down 1.54 percent. According to the regulator, the banks had failed to remit $2.1 billion to the government’s CBN account, which was Abuja’s share of dividends from the NLNG. Last year, President Muhammadu Buhari ordered government payments to be made into one single CBN account as part of his pledge to fight graft. One of the banks, UBA, said it did not withhold any government funds, and its suspension was lifted late Wednesday.

Nigeria’s 11 DISCOs say the inability of the Transmission Company of Nigeria to efficiently supply electricity to their networks was costing them ₦1 billion in monthly revenue. The distributors, who spoke via their platform, the Association of Nigerian Electricity Distributors were responding to TCN’s recent claims that they, not it was the weakest link in the nation’s electricity value chain. ANED said the TCN still retained the “unholy character of the defunct and hugely corrupt Power Holding Company of Nigeria,” adding the company has not been able to guarantee its members, particularly their northern operations, stable power supply.

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