CBN debunck NNPC secret Press release

The attention of the Central Bank of Nigeria (CBN) has been drawn to publications in the media over allegations at the public hearing of the Senate Joint Committee on Petroleum Resources (Downstream) and Appropriation and Finance, that the CBN operates a secret foreign bank account.

As banker and financial adviser to the Federal Government and its Ministries, Departments and Agencies (MDAs), the actions and activities of the Central Bank of Nigeria, fall within the principles of banker-customer relationship.

The CBN does not and cannot open any account for Government and its agencies, unless and until clear and specific instructions, approvals or mandates are issued by the appropriate authorities.

We wish to state clearly, the following facts regarding the accounts in question:

1. That the CBN/NNPC Crude Oil & Gas Account was opened on 16th May, 2002, on the express instruction of the Accountant-General of the Federation (OAGF) vide a mandate ref: No; CS/5385/S.23/94/DDF, dated 15th May, 2002.

2. That the CBN/NNPC Gas Account was opened on 3rd February, 2009, following a similar instruction from the Account-General of the Federation, vide mandate ref. No.; FD/5385/S.71/1/178/DF, dated 28th January, 2009.

3. That the two accounts, which were opened as domiciliary accounts, are backed by the appropriate mandates of the OAGF.

4. That in operating the said Accounts, the NNPC on monthly basis issues instructions to the CBN on how much should be paid as Joint Venture Cash Call (JVC) and how much should be monetised and transferred to the Federation Account for distribution to the three tiers of government. A minimum balance of USD10m is always left in the revenue account.

5. That on the CBN/NNPC Gas Account, the NNPC issues monthly mandates to enable the CBN monetise and transfer the balance in the account to the Federation Account, leaving a minimum balance of USD5 million.

6. That all movements of funds out of the accounts are duly authorised by NNPC.

7. That the role of the CBN, as banker to Government and MDAs, is limited to the following:
a. Ensuring that lodgments/deposits into the accounts are consistent with their requisite mandates;
b. Providing customers with the statements of accounts. In the case of the accounts in question, NNPC and OAGF are provided the statements of account on a weekly basis;
c. Ensuring that accounts are reconciled regularly. In the case of the said accounts, this is done with with both JP Morgan Chase and NNPC while the OAGF is availed with monthly reconciliation reports on the accounts.

8. Above all, it is important to reiterate for the purposes of clarity, that:
i. Mandates to open the accounts were duly authorised by OAGF;
ii. NNPC remains the sole signatory to the accounts;
iii. NNPC issues and authorises the mandates for movement of funds out of the accounts and
iv. CBN acts only in accordance with mandates issues by NNPC on these accounts.

9. The CBN wishes to reiterate that in light of these verifiable facts presented above, there was no truth in the allegation insinuating that the CBN is maintaining secret foreign accounts.

Ugo A. Okoroafor
Director, Corporate Communications Department