Reps to probe interest accrued to foreign reserve accounts, appointment of FRA managers

House of Representatives on Wednesday asked the Central Bank of Nigeria (CBN) to declare the particulars of the accounts in which the foreign reserve accounts of the federation (FRA) are held and interests accruable over the last four years, without delay.

Similarly, the House urged the CBN, which serves as banker to the government according to Section 36 of the CBN Act, 2007, to report the criteria for engaging any and all foreign managers of the FRA of the federation to ensure transparency.

The lawmakers passed the resolution following the adoption of the motion titled: ‘Calling on CBN to declare interests accruable to the FRA of the federation,’ sponsored by Abdulssamad Dasuki.

The House also emphasised the need for the apex bank to report annually on the performance of the accounts and continued compliance of the managers with any set guidelines issued by the CBN for the engagement of the fund managers.

In his lead debate, Dasuki observed that the apex bank maintained several FRAs on behalf of the federation containing funds in foreign currencies that are held in financial institutions before they are shared during the monthly federation accounts allocation committee (FAAC) meeting.

“The House is aware that reasonable interests accrue from the surplus of funds held by the CBN on behalf of the federation, which have not been monetised into naira and received by the federation from CBN from the foreign bank accounts.

“The Nigeria Sovereign Investment Authority (NSIA) was established, among other reason, to undertake the management of the excess crude account funds on behalf of the federation and that domestic capacity is being developed in order that large state-owned funds can be managed by Nigerians.”

Dasuki, who frowned at the failure of the apex bank from openly declaring accruals from foreign reserve accounts, argued that the accounts “remain indiscernible in public records.”

According to him, some states have persistently agitated for discountenance of the ‘agreement’ allowing the FAAC to decide savings or reserves from disbursable funds to the components of the federation.

He maintained that the “entire circumstances regards the management of the Excess Crude Accounts (ECA) of the federation is straining the relationship between the three tiers of government, in particular, with the arguments of some states that they require the unutilised funds for imminent developmental purposes and so do not support the continued arrangement.”