Tag: CBN

CBN

  • We’ll release more forex to further weaken Dollar against Naira – CBN

    The Central Bank of Nigeria (CBN) on Sunday reiterated its determination to sustain the provision of foreign exchange (forex) with a view to ensuring liquidity in the market and enhance accessibility and affordability for genuine end users.

    The apex bank’s acting Director, Corporate Communications; Mr Isaac Okorafor in a statement on Sunday said the bank wants to disabuse the notion by market speculators that it wouldn’t be able to sustain its forex intervention.

    He said that the bank would again, early this week, inject more foreign exchange into the market, leading to a further weakening of the dollar.

    This is in addition to the further increase in the sale of dollars to the Bureau de change operators from 8,000 dollars to 10,000 dollars per week,’’ he said

    Okorafor warned commercial banks and other dealers to desist from sabotaging the efforts aimed at making life easier for foreign exchange end users.

    According to Okorafor, the CBN had received complaints from customers over frustrations in getting foreign exchange for invisible items like tuition fee, medicals, personal and basic travel allowance.

    The Bank urged the general public to report it to any bank that failed to meet customers’ needs after due documentation.

    It once again reiterated its determination to deal with any official or institution found to be sabotaging the operations of foreign exchange market in whatever guise.

    TheNewsGuru.com reports that the Naira closed at N394 to a dollar on Friday, which translated to 10 per cent depreciation of what was recorded earlier in the week.

    The depreciation was attributed to the alleged hoarding of forex by banks rather than selling to genuine customers.

    Analyst believe that with the twice weekly sale to BDCs up to 20,000 dollars, the Naira is likely to appreciate in the coming week.

     

  • Why Naira depreciates despite CBN’s intervention – Gwadabe

    The President, Association of Bureau De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, has blamed the recent depreciation of naira on the speculators’ onslaught and resistance by the banking industry.

    Gwadabe told the newsmen on Saturday in Lagos that the refusal of some banks to sell the invisibles such as personal and business travel allowances frustrated naira recovery.

    The ABCON chief said that the CBN had recently accused the banks of frustrating its policies.

    He said it was ironical that the naira started losing strength in spite of the CBN’s review of the rates from N375 to N360 to a dollar.

    According to him, the naira started trading on Monday with a promising outlook for sustained strength against the dollar and other currencies, but it began to somersault at the middle of the week.

    “The naira ended deeper northward to close at N394 to a dollar on Friday, translating to 10 per cent depreciation of what was recorded during the week,’’ Gwadabe said.

    The association president said that the removal of disparity in applicable exchange rates among the BDCs, Travelex and the banks should have strengthened the nation’s currency.

    The financial expert said, “CBN’s knack for last minute solution as recent development has shown, accounted for the misfortune of the naira at the foreign exchange market.’’

    Gwadabe said that the battle for the soul of the naira would be won if the CBN could boost liquidity to the BDCs for effective unification of rates.

    “It is evident that the injection of liquidity to the interbank market rather than the BDC sub-sector is not effective and transparent for sustained FOREX rate convergence and unification.

    “Statistics from the CBN shows that about 20 banks get 80 million dollars weekly for invisible transaction as against the 20 million dollars weekly for over 3000 CBN licensed BDCs nationwide.

    “The CBN should enhance public awareness to guide end users on FOREX availability and applicable exchange rates.

    “The CBN should diversify the buffers from oil proceeds to foreign investors inflows and Diaspora remittances,’’ Gwadabe said.

    He urged the CBN to sponsor a bill for an act of the National Assembly for naira convertibility in West Africa, as part of the solutions to full recovery of the naira.

    Gwadabe said that naira was currently a means of exchange in about 15 countries in Africa.

    He urged the Federal Government to increase security surveillance at the nation’s airports and land borders to checkmate illegal foreign cash evacuation.

    TheNewsGuru.com reports that the naira ended the week on a negative note, eroding the 12.36 appreciation it recorded in its trading last week.

    The Nigerian currency appears to be on trial again, as experts argue that winning the battle for the soul of the naira requires more than pulling the monetary policy lever.

    They called for a blend of fiscal and monetary policy and indeed patriotism from all Nigerians to save the naira from further sliding.

     

    NAN

  • CBN re-introduces charges on cash deposits, withdrawals above N500,000

    CBN re-introduces charges on cash deposits, withdrawals above N500,000

    The Central Bank of Nigeria, CBN on Thursday announced the re-introduction of bank charges on cash deposits and withdrawals above N500,000 and N1m respectively.

    The decision of the apex bank was made known in a circular signed by the Director, Banking and Payments System Department, Mr. Dipo Fatokun to all Deposit Money Banks, DMBs.

    The apex bank explained that the decision to reintroduce the charges on cash deposits was part of the review of charges on deposits and withdrawals under the cashless policy.

    TheNewsGuru.com reports that the charge which was once effective, was suspended in 2014 by the apex bank.

    Fatokun explained that the decision was taken at the Bankers’ Committee meeting, which was held in Abuja two weeks ago. He said the committee also decided that the cashless policy should be extended to the remaining 30 states of the federation.

    The apex bank however directed that effect from April 1, 2017, banks in the states where the cashless policy was already operating, Lagos, Ogun, Anambra, Abia, Kano, Rivers and the Federal Capital Territory, would begin to impose charges on deposits and withdrawals above N500,000.

    According to the CBN, banks will from the said date (April 1) begin to charge individuals 1.5 per cent and two per cent for deposits and withdrawals between N500,000 and N1m. According to the circular, individuals depositing or withdrawing between N1m and N5m will be charged two per cent and three per cent, respectively. For amounts above N5m, banks will charge such individuals three per cent and 7.5 per cent for deposits and withdrawals, respectively.

    With regard to corporate customers, the CBN stated that deposits and withdrawals under N3m would not attract any charge, but that such customers depositing or withdrawing between N3m and N10m would be charged two per cent and five per cent, respectively. Also for deposits and withdrawals between N10m and N40m, customers will be charged three per cent and 7.5 per cent, respectively.

    Deposits or withdrawals above N40m by corporate customers will attract a charge of five per cent and 10 per cent, respectively. According to the CBN, the new policy on charges will be implemented in selected states on May 1 and August 1, this year; while the total implementation will be concluded on October 1.

    The regulator noted that the committee agreed that income generated from the processing fees above the allowable cash limits would be shared between it and the banks in the ratio of 40:60.

    However, the CBN said that existing exemptions to the policy such as revenue generating agencies of the federal, state and local governments (for lodgements) will be sustained. Also exempt from the processing fees are embassies, diplomatic missions, multilateral and aid agencies.

    TheNewsGuru.com reports that the apex bank however directed lenders to train their employees to enlighten customers on the new policy.

  • Forex: CBN injects $370m into market

    Forex: CBN injects $370m into market

    The Central Bank of Nigeria (CBN) yesterday carried out wholesale interventions in the interbank foreign exchange market by providing 370.9 million dollars to 23 banks to meet the visible and invisible requests by customers.

    Its Acting Director of Corporate Communications, Mr Isaac Okorafor, said the bank’s intermediation in the market was aimed at easing the pressure of access to foreign exchange by Nigerians.

    He said that the CBN offered 500 million dollars for sale to the banks, but not all of them provided enough naira backing to pay fully for their respective bid amounts.

    Okorafor said that the qualified bids for dollars ranged from N315 to N360.

    He said seven banks received full allotments of their respective bids valued at 37.5 million each, while other banks received allotments ranging from 46, 512 dollars to 15.57 million dollars.

    He said also that the CBN had also made spot sales of 1.5 million dollars to four banks totaling six million dollars.

    “The Bank also offered 41 million dollars for sale out of which 35 million dollars was taken up for the payment of school fees, medical bills and personal and business travel allowances,” he said.

    Okorafor assured that the bank would continue to make interventions based on qualified bids from the banks on the requests of their customers.

    He said that the bank was more than ever ready to support the inter-bank market by ensuring liquidity and transparency to guarantee efficiency in the foreign exchange market.

    Okorafor urged all market participants to contribute their patriotic quota to assist in ensuring that the new measures by the CBN would guarantee the steadiness of the financial market.

    It will be recalled that the CBN introduced new actions on foreign exchange aimed at easing access to foreign exchange for personal and business travel as well as educational and medical fees, among others.

    As part of its new policy action, the CBN also directed all to open foreign exchange retail outlets at major airports as soon as logistics would permit them to do so.

     

    NAN

  • We don’t deal directly with bank customers on forex transactions – CBN

    We don’t deal directly with bank customers on forex transactions – CBN

    The Central Bank of Nigeria, CBN has said contrary to public opinion, it does not deal directly with any bank customer on forex exchange transactions.

    The apex bank noted that forex transactions are strictly restricted to Deposit Money Banks (DMBs) and their respective customers.

    This was contained in a statement released and signed by the apex bank’s Acting Director, Corporate Communications, Isaac Okorafor and obtained exclusively by TheNewsGuru.com.

    The statement reads in full:

    CBN makes further clarification on FOREX sale

    The attention of the Central Bank of Nigeria (CBN) has been drawn to a media report suggesting that the Office of the Attorney General of the Federation and Minister of Justice has issued a query to the Central Bank of Nigeria (CBN) over issues relating to the sale of foreign exchange.

    While it is perfectly normal for any agency of Government to seek clarifications on any matter from other agencies of Government, we wish to state that neither the Governor of the CBN nor the Director, Legal Services Department has received any communication with regard to the issue.

    The CBN, as a responsible and responsive arm of Government, will always provide clarifications on any matter within its purview for the purpose of educating and enlightening all concerned.

    Accordingly, we wish to reiterate our position by making the following clarifications:

    1. The CBN DOES NOT deal directly with any Bank customer on foreign exchange transactions. Such transactions are consummated strictly between the customers and their respective Deposit Money Banks (DMBs);
    2. The figures of FOREX sale published in national dailies or on CBN website, over which insinuations are being formed, were transactions consummated between the DMBs and their customers;
    3. Pursuant to our policy of transparency, we publish the reports of purchases and sales of forex between the DMBs and their customers, as submitted by the banks without editing. This practice of publishing the figures on our website has been on since October 2016;

    Following observations of different exchange rates after the last publication on our website (www.cbn.gov.ng), we called for explanations from the banks concerned.

    1. In response to our queries to them, apart from some observed formatting errors, the concerned banks reported that the returns were sent on the basis which the transactions were conducted. The transactions concerned were consummated in third currencies such as Japanese Yen and South African Rand (YEN/ZAR); JPY/NGN, EUR/USD, USD/ZAR. As a result, there is no way any DMB or the CBN will deal in forex transaction at the rate of 61kobo/USD, N18/US$1 or N3/US$1, as was erroneously reported.
    2. The aforementioned are third currency transactions and when properly translated, will be in line with the prevailing forex rate range in the interbank market. Consequently, to prevent any such occurrence in the future, the CBN has directed ALL Deposit Money Banks to render their returns in a uniform format converting all forex sales and purchases to NGN/USD. All third currency transactions are also to be converted to NGN/USD.

    Again, we urge all concerned stakeholders to always verify information on matters relating to the Bank before going public in order not to trigger volatility in the market.

  • CBN finally bows to pressure, orders banks to open FX offices at airports

    The Central Bank of Nigeria (CBN) has mandated banks to open Forex retail office at all major airports to ease transactions for intending travellers.

    The apex bank made the declaration in its new policy action on the Foreign Exchange Market today in Abuja on Monday.

    The statement reads in full:

    “New Policy Actions in the Foreign Exchange Market

    In continuation of efforts to increase the availability of Foreign Exchange in order to ease the difficulties encountered by Nigerians in obtaining funds for Foreign Exchange transactions, the Central Bank of Nigeria (CBN) is providing direct additional funding to banks to meet the needs of Nigerians for Personal and Business Travel, Medical needs, and School fees, effective immediately. The CBN expects such retail transactions to be settled at a rate not exceeding 20 percent above the interbank market rate.

     

    1. Travel Allowances

    Having cleared the historic backlog of matured letters of credit at the inception of the current flexible exchange rate system, the CBN would immediately begin to provide foreign exchange to all commercial banks to meet the needs of both personal travel allowances (PTA) and business travel allowances (BTA) for onward sale to customers. All banks would receive amounts commensurate with their demand per week, which would be sold to customers who meet usual basic documentary requirements.

     

    1. School and Medical Fees

    Similarly, the CBN would meet the needs of parents, guardians and sponsors who are seeking to make payments of school and educational fees for their children and wards. Such payments must be made by commercial banks directly to the institution specified by the customer. The CBN would ensure that this process is as smooth as possible and that as many customers as possible get the foreign exchange they genuinely demand. This would also apply to customers seeking to make payments, or purchase foreign exchange, for medical bills and paid directly to hospitals. The supply of FX to retail end-users (PTA, BTA, School fees, medical bills, etc) would be sustained by the CBN.

     

    1. Forward Sales Tenor

    In order to further increase the availability of foreign exchange to all end-users, the CBN has decided to significantly reduce the tenor of its forward sales from the current maximum cycle of 180 days, to no more than 60 days from the date of transaction.

     

    1. FX Sales at Major Airports

    In order to further ease the burden of travellers and ensure that transactions are settled at much more competitive exchange rates, the CBN hereby directs all banks to open FX retail outlets at major airports as soon as logistics permit.

     

    1. Increase Efficiency of FX Market

    In order to maintain confidence in the FX market, the CBN will immediately take the following steps:

    1. Begin implementing its articulated program to clear all the unfilled orders in the interbank FX market;
    2. Given our plan to meet all unfilled orders, and while provision of FX to the manufacturing sector would remain the CBN’s strong priority, we will no longer impose allocation/utilization rules on commercial banks;
    3. Implement an effective intervention programme to support the inter-bank market to ensure adequate liquidity necessary to deliver an efficient FX market;
    4. Advise FMDQ to activate its FX Order-Book systems as soon as possible and also accelerate the on-boarding of FX clients on the FX Relationship Systems to ensure total transparency of the FX market.”
  • Forex: CBN boosts manufacturing, agriculture, others with $2.83bn

    Forex: CBN boosts manufacturing, agriculture, others with $2.83bn

    The Central Bank of Nigeria (CBN) says it disbursed 2.83 billion dollars to critical sectors of the economy between December 2016 and January 2017.

    Mr Isaac Okorafor, the Acting Director, Corporate Communications Department of CBN, made this known in a statement on Thursday in Abuja.

    He said that manufacturing, raw materials and agriculture topped the disbursements targeted at the employment and wealth generating sectors of the economy.

    He said that 609 million dollars and 228 million dollars were released for raw materials in December 2016 and January 2017, respectively.

    He said that manufacturing attracted 53 million dollars and 71 million dollars, respectively during the same period.

    Okorafor said that the foreign exchange utilization figure indicated that 1.8 billion dollars and 0.9 billion dollars, respectively were extended to critical sectors like manufacturing, agriculture, petroleum products and airlines, among others in December 2016 and January 2017.

    He reiterated the CBN’s determination to continually ease the foreign exchange pressure on critical sectors.

    “It will be recalled that the CBN, in the month of November 2016, supported critical sectors with 1.07 billion dollars equivalent of foreign exchange for agricultural machinery, industrial raw materials, education and personal travel allowances.

    “This was to source industrial raw materials and spare-parts through the interbank foreign market.’’

     

    NAN

  • Ease monetary policy, stabilize exchange rate to stop inflation, Don advises CBN

    Ease monetary policy, stabilize exchange rate to stop inflation, Don advises CBN

    An Economist, Prof. Sheriffadeen Tella, on Thursday called on the Central Bank of Nigeria (CBN) to ease its monetary policy and stabilise the exchange rate to stem the nation’s rising inflation.

    Tella, who works at the Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Ogun, gave the advice in an interview with the newsmen in Lagos.

    TheNewsGuru.com reports that Tella was reacting to the January inflation figure, which rose by 0.17 per cent.

    According to the data released by the National Bureau of Statistics (NBS) on Feb. 15, the inflation rose from 18.55 per cent posted in December to 18.72 per cent in January.

    The increase of 0.17 per cent growth when compared with the December figure was driven by the surge in food, transport and electricity prices.

    The statistics office added that a separate food index also rose to 17.82 per cent from 17.39 per cent in December.

    Tella said that high interest rate and the continuous depreciation of the naira had led to persistent rise in inflation.

    “I never expected the inflationary rate to fall given the persistent high cost of production fuelled by high interest rate, continuous depreciation of the naira and tight money policy.

    “These policies have negative effects on production of goods locally and high cost of imported goods.

    “Though, demand itself is constrained, people have diverted spending to foods and medicine resulting in high prices of both.

    “If you look at what drives inflation during the reported time you will see the roles of these two sub-sectors.

    “The CBN should ease monetary policy and stabilise the exchange rate in the first instance to enable it to appreciate,” Tella said.

    He advised the apex bank to change the colour of the naira’s high denominations to stop speculative attack and take care of the fake notes in circulation.

     

    NAN

  • N8bn Currency scam: Witness says syndicate behind fraud in CBN

    N8bn Currency scam: Witness says syndicate behind fraud in CBN

    Mr Edwin Ennah, a witness in the case of alleged N8 billion CBN currency scam on Tuesday said that there was a syndicate at the Ibadan branch of the apex bank behind the fraud.

    Testifying before Justice Nathaniel Ayo-Emmanuel, Ennah, a retired Head of Currency Processing and Disposal Unit, said that he discovered that some people were replacing cut newspapers and lower denominations with N1,000 that were supposed to be destroyed.

    He said that since he made the discovery in 2013 no investigation had been conducted by the branch to establish the veracity of this discovery.

    Ennah added that his investigation revealed that there were 11 boxes which were supposed to be containing N10 million each of N1,000 denomination, totalling N110 million.

    These, he added, were replaced with either lower notes or newspapers cuttings.

    The witness stated that CBN lost over N65 million in that singular incident.

    He further said that upon the discovery that there was a mix of cut newspapers and lower denominations in the boxes sent by Sterling Bank, he asked the bank to send their representatives to witness the inspection of their boxes.

    Ennah said that he was, however, surprised that the bank declined response until he reported the matter to the CBN office in Abuja which compelled it to comply.

    Meanwhile, the fifth accused person, Emmanuel Ordia, on resumption of trial filed a bail application on grounds of ill health.

    The prosecution counsel, Adebisi Adeniyi, prayed the court to reject the arguments adduced by the defence counsel, A. Adebayo.

    Ayo-Emmanuel adjourned ruling on the bail application and further trial to Wednesday.

    It would be recalled that Kolawole Babalola, Muniru Olaniran, Kayode Togun, Ibrahim Salami and Emmanuel Ordia along with others had since 2015 been standing trial over multiple charges.

    The charges border on conspiracy, conversion, forgery, stealing and re-circulation of mutilated N8 billion at the Ibadan branch of CBN.

  • FG likely to reverse CBN’s forex ban on 41 items – Customs

    The Zonal Coordinator, Zone ‘A’ of the Nigeria Customs Service, Assistant Comptroller-General Monday Abueh, has said that the Federal Government may reverse the foreign exchange restriction placed on 41 items imported into the country.

    Abueh disclosed this in Ibadan during his familiarisation tour of Oyo/Osun Commands as part of his visits to Customs formations under his jurisdiction.

    TheNewsGuru.com recalls that the Central Bank of Nigeria, CBN had on July, 2015, restricted 41 items, including vegetable oil, poultry products, cosmetics, plastic and rubber products, among others, from access to foreign exchange.

    The apex bank said the country had the capacity to produce those items locally.

    Abueh said that when government’s policies were rolled out, they were in the interest of the people, adding that Nigeria could not be enriching other countries by allowing some banned items into the country.

    He advised officers to be fully sensitised about implementing government’s policies anywhere they were posted to serve.

    Abueh urged officers to ensure non-passage of rice and vehicles into the country.

    He said that smugglers might try to make Oyo and other land borders their alternative routes since security at Idiroko and Seme was tight for them.

    The zonal coordinator said that the Comptroller-General, Retired Col. Hameed Ali, and the Customs Management had redeployed officers to land borders’ commands to ensure that nothing escaped through all the routes in the areas.

    He also urged officers to learn excise operations to assist in cargo clearance.

    Abueh said his visit was meant to remind officers about the Federal Government’s polices as well as the directive given by the comptroller-general to ensure security and protection of lives in the country.

    He said, “Officers should be mindful of their duties and responsibilities as you embark on your primary assignment.

    “If you are careless in your duties and if you are caught, you will be held responsible for your action.”

    The assistant comptroller-general urged officers to ensure collection of duties on general goods coming through the borders.

    According to him, the language in the service nowadays is for officers to be knowledgeable about the operations of the service.

    Abueh urged officers to be willing to learn further, adding that without doing this, such officers would be having problems with operations.

    He, however, commended officers and men in Oyo/Osun command for being on top of their operations as they recorded tremendous seizures.

    He said, “The numerous seizures had indicated that smuggling in this axis are high. That is why I am here to convey the comptroller-general’s message to officers to continue doing the good job.

    “Officers should ensure 100 per cent examination before approving document for delivery of consignment, because any mistake after clearance will not be acceptable by the service.”

    After inspecting the command’s warehouse, the zonal coordinator discovered that the warehouse was full with seizures of rice, vegetable oil, used tyres, second-hand vehicles and other items.

    Abueh said the Management of the NCS would request for officials of the National Agency for Food and Drug Administration and Control to ascertain the state of the edible items before destroying them to avoid environmental hazards.

    He warned smugglers to desist from unlawful operations and follow due process in clearing goods in order to avoid seizures.

    The Customs Area Controller of Oyo/Ogun, Comptroller Tope Ogunkua, disclosed that the seizures were intercepted over the years.

    Ogunkua said that the command’s warehouse was having dangerous odour due to some items like rice, which had expired in the store.

    He said that the command generated N14.8bn between January and December 2016.

    Ogunkua said that the command’s target for 2016 was N19.3bn but it had a shortfall of N4. 5bn.

    He said that command would not relent in its effort to suppress smuggling to the barest minimum.

     

    NAN