Forex: CBN goes tough on Banks

Must Read

Accommodate All, NALVEJ Tasks NAWOJ Treasurer

By Steve Oni, Ilorin Kwara state Chairman of the National...

NiDCOM congratulates Adeyemo on his nomination as U.S. Deputy Treasury Secretary

Nigerians in Diaspora Commission (NiDCOM) has congratulated Nigerian-born Adewale Adeyemo on his nomination as the U.S. Deputy...

Medical director tasks doctors on brain drain

The Chief Medical Director, Federal Medical Centre (FMC), Abuja, Prof. Saad Ahmed, has advised medical practitioners who...

 

…floods market with $545m

By Aaron Ossai

The Central Bank of Nigeria (CBN) has threatened to sanction any Deposit Money Bank (DMB) in breach of its earlier directive of March 3, 2017 instructing them to, among other things, open teller points for retail forex transactions and to have electronic display boards in all their branches, showing rates of all trading currencies. This is even as the Bank sustained its intervention in the various sectors of the inter-bank Foreign Exchange market with the injection of $545 million.

A circular issued by the Bank warned that the CBN would mete out stiff regulatory sanctions to banks that fail to comply fully with the directive by October 13, 2017. The circular signed by the Director, Banking Supervision, Ahmad Abdullahi, stressed that the Bank would bar erring DMBs from all future CBN foreign exchange interventions.

It will be recalled that the CBN in March 2017 had directed banks and authorized dealers to open a teller point for retail FX transactions (PTA/BTA and SME) including buying and selling, in all locations in order to ensure access to foreign exchange by their customers and other users, without any hindrance.

The March 2017 circular also directed DMBs to have electronic display boards in all their branches, showing rates of all trading currencies, which it urged customers to insist on in processing their foreign exchange transactions for invisibles and the SMEs window.

While noting that the objective was aimed at creating awareness among members of the public regarding the availability of such facilities in branches of the banks at clearly disclosed prices, the CBN frowned at the banks for not fully complying with its directives.

Accordingly, the CBN has given the erring banks a four-week period, expiring on October 13, 2017, to fully comply with its directives or face regulatory sanctions, which it noted include but not limited to being barred from all future CBN foreign exchange interventions.

Meanwhile, giving a breakdown of the Bank’s latest forex injection, its Acting Director, Corporate Communications, Isaac Okorafor, revealed that the retail Secondary Market Intervention Sales (SMIS) received the largest intervention of $285 million. Other components of the released figures include the $100 million offered for wholesale SMIS, $90 million for Small and Medium Enterprises (SMEs) window and $70 million for invisibles such as Basic Travel Allowances, tuition fees and medical payments.

According to Okorafor, the amount released underscored the CBN’s avowed commitment to ensure a liquid interbank foreign exchange market, where all genuine requests will be met in line with extant forex guidelines.

Speaking further, the CBN spokesperson expressed optimism that, with the accretion to the nation’s foreign reserve, the Bank would continue to fulfil its mandate of safeguarding the international value of the legal tender. He further disclosed that the Bank’s management also remained optimistic about achieving a convergence between the forex rates at both the inter-bank and BDC segments.

- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisement -

Latest News

Accommodate All, NALVEJ Tasks NAWOJ Treasurer

By Steve Oni, Ilorin Kwara state Chairman of the National...

NiDCOM congratulates Adeyemo on his nomination as U.S. Deputy Treasury Secretary

Nigerians in Diaspora Commission (NiDCOM) has congratulated Nigerian-born Adewale Adeyemo on his nomination as the U.S. Deputy Treasury Secretary by. President-elect Joe...

Medical director tasks doctors on brain drain

The Chief Medical Director, Federal Medical Centre (FMC), Abuja, Prof. Saad Ahmed, has advised medical practitioners who had benefited from government’s investment...

Trump lost by not showing empathy on pandemic – Former campaign chief

U.S. President Donald Trump would have won the election in a “landslide” had he publicly showed empathy with regards to the coronavirus...

Borno Killings: Tinubu group asks security agencies to step up intelligence gathering

The Tinubu Support Group (TSG) has called on the nation’s security agencies to step up intelligence gathering to prevent further loss of...
- Advertisement -

More Articles Like This

- Advertisement -