Section 14: Minimum Holding of Cash Reserves, Specified Liquid Assets, Special Deposits and Stabilisation Securities.

(1) Every bank shall maintain with the Bank, cash reserves, and special deposits or any non-interest banking instruments as may be approved by the Bank and hold specified liquid assets or other securities, as the case may be, not less in amount than as may, be prescribed by the Bank by virtue of section 45 of the Central Bank of Nigeria Act.
(2) Where both assets and liabilities are due from and to other banks, they shall be offset accordingly, and any surplus of assets or liabilities shall be included or deducted, as the case may be, in computing specified liquid assets.
(Act No. 7 2007)
(3) In the case of the long-term advances to a bank or by an overseas branch or office of a bank, the advances may, with the approval of the Bank, be excluded from the demand liabilities of the bank.
(4) Every bank shall-
(a) furnish within the specified time, any information required by the Bank to satisfy the Bank that the bank is observing the requirements of subsection (1);
(b) not allow its holding of cash reserves, specified liquid assets, special deposits and securities to be less than the amount which may be prescribed by the Bank; and
(c) not, during the period of any deficiency, grant or permit increases in advances, loans or credit facilities to any person without the prior approval in writing of the Bank.
(5) Any bank which fails to comply with any of the provisions of subsection (4), is liable on conviction to a penalty of not less than N5,000,000 and an additional penalty of N 100,000 for each day during which the contravention continues.
(6) For the purpose of this section, specified liquid assets, provided they are freely transferable and free from any lien or charge of any kind, shall, without prejudice to the provisions of section 45 of the Central Bank of Nigeria Act, consist of all or any-
(Act No. 7 2007)
(a) currency notes and coins which are legal tender in Nigeria;
(b) balances at the Bank;
(c) net balances at any licenced bank (excluding uncleared effects) and money at call in Nigeria;
(d) treasury bills, treasury certificates and any non-interest banking instrument as may be approved by the Bank issued by the Federal Government;
(e) inter-bank placement, inland bills of exchange and promissory notes re-discountable at the Bank;
(f) other securities issued by the Federal Government with such dates of maturity as may be approved by the Bank;
(g) negotiable certificates of deposit approved by the Bank; and
(h) such other negotiable instruments as may be approved by the Bank for the purpose of this section.