Nigeria: CBN takes €2 billion from banks for bailout fund

May 22, 2014

The Central Bank of Nigeria (CBN) has debited N111 billion (€2 billion) from banks as contributions to the Resolution Cost Fund - a sinking Fund managed by the Asset Management Corporation of Nigeria (AMCON).

The Central Bank of Nigeria (CBN) has debited N111 billion (€2 billion) from banks as contributions to the Resolution Cost Fund - a sinking Fund managed by the Asset Management Corporation of Nigeria (AMCON).

Each bank is required to contribute 0.5 percent of total assets and 0.5 percent of 33 percent of their off balance sheet items to the fund.

Vanguard revealed that the withdrawal of the N111 billion, coupled with the withdrawal of N115 billion by the Nigeria National Petroleum Corporation (NNPC) from the banks, caused the volume of excess liquidity in the interbank money market to fall by 36 percent.

This fund was set up to assist AMCON to meet its goals and also ensure that government will not bear the cost of financial
crises
in future.


AMCON was created to help recapitalise eight banks that benefited from a government bailout following the 2009 economic crisis.ADNFCR-2976-ID-801722259-ADNFCR