After the Supreme Court judgment on Friday which extended the validity of the old N200, N500 and N1,000 naira notes till December 31, some deposit money banks (DMBs) have started complying with the apex court’s ruling.
According to a New Telegraph report on Monday, some commercial banks in Lagos, Kano and Abuja had started paying out the old N500 and N1000 notes.
In Lagos, one of the branches of a Tier 2 bank also loaded the old N500 and N1,000 notes in its Automated Teller Machines (ATMs), which were dispensing to members of the public at the time New Telegraph’s correspondent visited.
A member of staff of a Tier 1 lender confirmed to New Telegraph that DMBs had received a directive from the Central Bank of Nigeria (CBN) to resume paying out the old banknotes. The staff said: “We have received the directive from the CBN to resume paying out the old N500 and N1,000 notes.
But only a few branches have started paying the notes. More branches will start paying the notes to customers tomorrow (today).” New Telegraph was unable to confirm if the CBN had officially issued a circular directing the banks to comply.
However, in an interview with New Telegraph, a Port Harcourt-based legal practitioner, Barrister Patrick Chukwunyem, said the commercial banks would have run the risk of incurring the wrath of the Supreme Court if they failed to comply with the apex court’s judgment.
He said: “The banks must have been advised by their legal departments that it was in their best interest to comply with the Supreme Court judgment. This is because a customer may decide to set up a bank by arranging with people to video him depositing one million naira (old notes) into his account, after which, he will immediately issue a cheque of the same amount to a friend to present for payment at the bank.
If the bank fails to honour the cheque on the grounds that it will not pay out old notes, the customer and his friend will then sue the bank for loss of business. If the case gets to the Supreme Court, it could order the bank to pay the plaintiffs hundreds of millions of naira as damages.”
Delivering judgment on Friday in a suit instituted by some states of the federation, a sevenmember panel of the Supreme Court held that the old N200, N500 and N1000 notes remain legal tender until December 31, 2023.
The court ruled that the directive by President Muhammadu Buhari to the CBN for the redesigning and withdrawal of old notes of N200, N500 and N1,000, without consultation with the states, the Federal Executive Council (FEC) and the National Council of State and other stakeholders, was unconstitutional.
Analysts said the banks’ compliance with the Supreme Court’s judgment came as a relief to millions of bank customers across the country that in the last two months have besieged bank premises in their bid to access scarce new naira notes.
