ABUJA/Nigeria: Ten Deposit Money Banks (DBMs) operating in the country have declared a whopping N26.8billion on current account maintenance charges in the first six months of 2017, investigations have revealed.
The lenders are Sterling Bank Plc, FCMB Group Plc, United Bank for Africa Plc (UBA), Zenith Bank Plc, Access Bank Plc, Guaranty Trust Bank Plc, First Bank of Nigeria Holdings Plc, Diamond Bank Plc, Union Bank of Nigeria Plc and Unity Bank Plc.
Deposit money banks periodically maintain customers account; and charge appropriate fees on such services.
Although, our findings revealed that out of the total contributed sum of N26.8bn generated from depositors current account maintenance, Tier-one banks accounted for N21.99bn during the period under review, and this represented a decline of 2.1 per cent from N22.46bn recorded in the corresponding period in 2016.
For instance, one of the big lenders considered, UBA account maintenance fee rose by 34.4 per cent from N1.9bn recorded in the first half of 2016 to N2.6bn in six months of 2017, while Access Bank within the same period p recorded 54.4 per cent increase to N1.9bn from N1.26bn.
But Zenith Bank and First Bank of Nigeria Holdings Plc, both declared depreciated figure of 6.69 per cent and 34.2 per cent drop, respectively, for the account maintenance fees during the considered period.
Therefore, Zenith Bank’s account maintenance fee, moved from N8.9 billion to N8.3bn; while First Bank of Nigeria reported N4.2bn account maintenance fee in six months of 2017 from N6.4bn reported in prior six months of 2016.
Further checks, however, showed that Sterling Bank was the only Tier-two bank that recorded decline in account maintenance fee. Other Tier-two lenders recorded significant increase in their account maintenance charges in the first half of this year.
Sterling Bank reported 4.5 per cent decline in account maintenance fee to N662 million as against N693m reported in six months of 2016.
Diamond Bank reported 27 per cent increase in current account maintenance fee from N1.8bn to N2.3bn, while Union Bank of Nigeria reported 19.3 per cent increase in account maintenance fee to N712m as against N597m in prior six months of 2016.
FCMB Group reported N738m in current account maintenance fee, an increase of 16.6 per cent from N633m reported in six months of 2016 while Unity Bank’ s current account maintenance fee rose marginally by 5.7 per cent to N369m from N349m in six months of 2016.
However, the Central Bank of Nigeria (CBN) had indirectly reintroduced Commission on Turnover (CoT) fee as Current Account Maintenance (CAM) Fee in 2013. The apex bank, in 2013, commenced phased reduction of CoT, which terminated with zero CoT charge this year.
However, the Director, Financial Policy & Regulation Department of the apex bank, Mr. Kevin Amugo, in a circular, replaced the CoT with CAM, but subject to maximum of N1 per N1000 (Mille).
The circular was titled, “Introduction of Negotiable Current Account Maintenance Fee Not Exceeding N1/Mille. It stated that “the Revised Guide to Bank Charges (RGBC) which came into effect on April 1, 2013 provides for a phased elimination of COT charges in the Nigerian banking Industry. Under the Guidelines, a zero COT regime was to come into effect from January 2016.”
The CBN noted that while the gradual phase out was being observed, some banks continued to charge Account Maintenance Fees in addition to the reduced COT rate, which, in effect, amounted to double coincidence of charges.
The CBN said it was not oblivious of the impact of declining crude oil prices; operation of Treasury Single Account; and other market turbulences on the viability and stability of the banking system.
“In furtherance of the mandate to promote and safeguard a sound financial system in Nigeria, banks are by this circular, reminded that the 2016 Zero COT regime as jointly agreed during the 311th Bankers Committee meeting of February 12, 2013 has come into effect.
“In the interest of stability of the banking system, a Negotiable Current Account Maintenance Fee not exceeding N1 per mille may be charged in respect of all customer induced debit transactions. Please ensure strict compliance,” the apex bank said.