The Nation Newspaper

Tag: cbn

  • CBN crashes dollar to N360

    CBN crashes dollar to N360

    Banks are to sell dollar at N360 for travel allowances, tuition and medical fees.

    A statement from the Central Bank of Nigeria (CBN) yesterday noted that “ $85 million for sale to Deposit Money Banks (DMBs) at the rate of N 357/$1 has been released by the apex bank for onward sale to retail end-users at not more than N360/$1, for invisibles, such as Basic Travel Allowance(BTAs), medicals, school fees, etc.”

    The CBN also offered $100 million to authorised FOREX dealers in the interbank wholesale window to meet the requests of genuine wholesale customers.

    The bank’s Acting Director in charge of Corporate Communications, Isaac Okorafor, said: ”The rates in the interbank window for wholesale transactions would still be determined by activities in the interbank market.

    “All banks have also been directed to immediately post the new N360/$1 rate on electronic display boards in the banking halls of their branches, as examiners from the CBN would visit banks to ensure the new rates are implemented.”

    The CBN spokesmen also reiterated the directive that all banks should meet the demand for Travel Allowances (PTA/BTA) by end-users within 24 hours of application. Applications for school fees and medical bills are to be met within 48 hours of application.”

    Okorafor warned that the new move, which is designed to further ease access of genuine end-users to forex, “prohibits banks from selling foreign exchange funds meant for invisibles to Bureau De Change (BDCs)”.

    He assured that “all banks would receive amounts commensurate with their demand per week, which would be sold to customers who meet usual basic documentary requirements”.

    He urged customers to report any erring bank to the CBN for investigation and appropriate sanction.

    On March 3,  through its Director, Financial Markets Department, Allan Ikoku, had all banks to open teller points in all locations to ensure access to foreign exchange by their customers without any hindrance.

    Ikoku also directed banks to have electronic display boards in all their branches, showing rates of all traded currencies; process and meet the demand for PTA/BTA customers within 24 hours of such applications and process and meet demands for school fees (including allowances) and medical bills within 48 hours of such applications.

    The reason for this earlier directive, he said was to further increase foreign exchange liquidity in the market and ensure availability to end-users.

    Non-compliance with these directives, he warned, “would attract sanctions, including but not limited to being barred from all future CBN foreign exchange interventions”.

    However, many banks in Abuja were overwhelmed by forex demands, particularly for BTA/PTA and for tuition fees so much so some customers were turned back and asked to come a week after they made applications for forex.

  • CBN to sell dollar to banks at N357, directs banks to sell at N360

    CBN to sell dollar to banks at N357, directs banks to sell at N360

    The Central Bank of Nigeria (CBN), on Monday said it would sell dollars to banks at N357 and direct them to sell to their customers at N360 with immediate effect.

    The apex bank, however, said the new rate would be for only customers’ basic travel allowance, school fees and medical treatment.

    In a statement issued in Abuja, the bank’s acting Director, Corporate Communications, Mr Isaac Okorafor, said 100 million dollars had been offered to authorised FOREX dealers to meet the requests of genuine customers.

    He further said all banks had also been directed to immediately post the new rate on electronic display boards in the banking halls of their branches.

    Okorafor said that examiners from CBN would visit banks to ensure the new rates were implemented, with immediate effect.

    The CBN spokesmen reiterated the bank’s directive to all banks to process and meet the demand for Travel Allowances (TA) by end-users within 24 hours of such application.

    He also said that applications for school fees and medical bills were to be approved by banks, within 48 hours of such application.

    Okorafor stressed that the new move was aimed at further easing access of genuine end-users of FOREX and prohibiting banks from selling foreign exchange funds meant for invisibles to Bureau De Change (BDC).

    According to him, all banks will receive amounts commensurate with their demands per week, which will be sold to customers who meet the basic documentary requirements-visa and flight ticket.

    He, therefore, urged customers to report any erring bank to CBN for investigation and appropriate sanction.

    Meanwhile, the naira continues to appreciate against the dollar at the black market, selling at N375 to a dollar, N420 to a Pound Sterling and N405 to one Euro.

    A FOREX operator in Abuja, who did not want his name mentioned, urged CBN to lower the price it was selling to BDCs as well before the next bid on Thursday.
    According to him, this is necessary to ensure level playing field for all foreign exchange dealers.

    NAN reports that CBN sold to BDCs at N390, expecting them to sell to end-users at N400.
    However, analysts said that with the current crash in prices, this might no longer be visible. (NAN)

  • Official, black market rates’ gap narrows over CBN’s interventions

    Official, black market rates’ gap narrows over CBN’s interventions

    The gap between the official  and the black market rates narrowed at the weekend, after the local currency firmed to N380 per dollar on the black market on Friday.

    On the official interbank market, the currency was quoted N307 over the weekend. February’s partial devaluation effectively created multiple exchange rates in the economy.

    The naira, in recent months, exchanged at over N510 to dollar, until the Central Bank of Nigeria (CBN) began massive interventions in the market.

    The figures showed  nearly three per cent appreciation from the previous sessions and near the CBN rate for consumers, traders said.

    The CBN, in a statement at the weekend, said it received bids for $81 million from authorised dealers last Friday after it offered to sell $100 million in currency on Thursday.

    The bank has been intervening in the official market to narrow the currency spread with the black market rate, which was N520 to the dollar a month ago after it devalued the naira for retail customers to N375.

    Meanwhile, for the first time since the dollar scarcity started, the CBN recorded $19 million surplus after it intervened in the interbank market.

    The development occurred after the CBN pumped $100 million into the interbank to meet demands at the retail end of the market, out of which authorised dealers were only able to pick $81.347 million after an initial bid for $91 million.

    Commenting on the offer, the Acting Director, CBN’s Corporate Communications, Isaac Okorafor, attributed the inability of authorised dealers to pick up the entire offer of the apex bank to increasing dollar supply and sense of apprehension among dealers, who anticipate a further crash in dollar rate.

    He reiterated the determination of the CBN to sustain its current interventions in the market. According to him, “those who doubt the capacity of the Bank to sustain the intervention in the forex market are beginning to have a change of mind”.

    Meanwhile, reports from Abuja and Lagos over the week indicated that the naira sustained its bullish ride against major currencies, especially the United States (US) dollar, which exchanged at an average of N385 to dollar.

    This has triggered further apprehension among speculators, who anticipated further losses given the continued crash of the dollar.

    With the naira closed at N307 to dollar on Friday to the official market, and the parallel market rate continued to slide, the optimism of the CBN Governor, Godwin Emefiele to achieve the convergence of forex rates between the Interbank and the bureaux de change markets appears to be on the horizon.

  • Rush for dollar drops as CBN records $19m surplus

    Rush for dollar drops as CBN records $19m surplus

    The demand for dollar by banks is now dropping across the country.

    For the first time since the dollar scarcity started, the Central Bank of Nigeria (CBN) on Friday recorded $19 million surplus after it intervened in the interbank market.

    The development occurred after the CBN pumped $100 million into the interbank to meet demands at the retail end of the market, out of which authorised dealers were only able to pick $81.347 million after an initial bid for $91 million.

    Speaking on the offer, the Acting Director of Corporate Communications at the CBN, Isaac Okorafor, attributed the inability of authorized dealers to pick up the entire offer to increasing dollar supply and sense of apprehension among dealers who anticipate a further crash in dollar rate.

    He reiterated the apex bank’s determination to sustain its current interventions in the market.

    He said, “Those who doubt the capacity of the bank to sustain the intervention in the forex market are beginning to have a change of mind.”

    Meanwhile, reports gathered in Abuja and Lagos over the week indicate the naira sustained its bullish ride against major currencies, especially the United States dollar, which exchanged at an average of N385 to dollar.

  • Naira consolidates strength against dollar

    Naira consolidates strength against dollar

    The Naira on Friday in Lagos consolidated its position against the dollar at the parallel market, the News Agency of Nigeria (NAN) reports.

    The Nigerian currency on Friday afternoon exchanged between N380 (buying rate) and N390 (selling rate), stronger than N400 recorded on Thursday, while the pound sterling and Euro closed at N490 and N430.

    At the Bureau De Change (BDC) window, the Naira was sold at N399 to the dollar, while the pound sterling and the Euro were sold at N500 and N400.

    The Nigerian currency appreciated at the interbank market, closing at N307 to the dollar, from N308 posted on Thursday.

    Traders at the market said liquidity boost at the interbank market by the CBN was fast forcing the rate down at the market.

    Meanwhile, Alhaji Aminu Gwadabe, the President of the Association of Bureau De Change Operators of Nigeria (ABCON), said CBN-licenced BDCs would incur regulatory losses of N130 million this week.

    Gwadabe told NAN that the losses were coming from CBN’s disparity in applicable exchange rates among players in the market.

    According to him, the public has refused to buy foreign exchange from BDCs for invisibles such as medicals, school fees, personal and business travel allowances at a rate above N375 to the dollar.

    The financial expert urged the CBN to promptly address the issue.

     

  • CBN gets bids for $100m

    CBN gets bids for $100m

    •Naira is N385/dollar 

    The Central Bank of Nigeria (CBN) has received bids for $100 million from  dealers in the interbank market to meet customers’ requests. The sale will be settled today.

    CBN spokesman Isaac Okorafor said  no intervention was made by the bank to meet requests for invisibles.

    Okorafor reiterated that the CBN will continue to intervene in the interbank market to meet all legitimate transaction-based foreign exchange demands by customers.

    The CBN had in its last auction sale offered $150 million to the interbank market with the highest bid rate at N335 to dollar while the marginal rate was N320 to dollar.

    Foreign exchange speculators are expected to lose over N100 million in the coming days as CBN intervention in the interbank market continues.

    Already there are heightened fears among traders and other market participants who are yet to recover from the losses of the last two weeks owing to sharp and sudden appreciation of the naira.

    Okorafor confirmed this development, reiterated that with improving reserve levels, the bank was determined to continuously make forex available to all genuine customers through their banks, advising those hoarding the greenback to reduce their losses by selling their dollar stock.

    Market watchers, say there is the likelihood of a liquidity glut as banks are beginning to send out salespeople to scout for customers to buy off their dollars in an effort to avoid losses arising from the expected further appreciation of the naira.

    The CBN has in the last one week supplied more than $1.4 billion to the market made to settle Personal Travel Allowances, Business Travel Allowance, medical fees and school fees among others.

  • Reps urge CBN to withdraw mutilated currency in circulation

    Reps urge CBN to withdraw mutilated currency in circulation

    The House of Representatives, on Thursday urged the Central Bank of Nigeria (CBN) to urgently withdraw and destroy mutilated naira notes in circulation.

    The house also charged the National Orientation Agency to carry out sustained public enlightenment to educate Nigerians on the need to handle the naira notes cautiously with care.

    The resolutions followed a motion by Rep. Adekola Alexander (PDP- Ekiti).

    Moving the motion, Alexander said that the alarming rate of mutilated currency notes in circulation had become a national embarrassment.

    He added that banks were issuing torn, mutilated and unhygienic currency notes through ATM machines and across the counter.

    “I observe that in spite of arrest and subsequent prosecution of the culprits, there is still a cartel in CBN and commercial banks, which make brisk business recycling old naira notes meant for destruction.

    “They enrich their bank accounts, acquiring properties through these illegal proceeds by converting the equivalent of the mutilated notes into their accounts and selling printed mint meant for customers, to touts and hawkers.

    “Section 21(4) of the CBN Act of 2007 makes it a punishable offence for any person to hawk, sell or trade in naira notes, coins or any other issued by the apex bank,” he said.

    The lawmaker expressed worry that most of the mutilated currency notes in circulation harboured pathogenic micro organisms hazardous to human health.

    He said that the mutilated notes also harboured infectious disease such as diarrhea, food poisoning and respiratory problems which could be spread through the notes.

    The motion was unanimously adopted by members when it was put to a voice vote by the Speaker, Mr Yakubu Dogara.

    The house, therefore, mandated the Committee on Banking and Currency to conduct an investigation into the activities of the cartel by beaming searchlight on the CBN, commercial banks and other allied institutions.

    The committee was given six weeks to carry out the assignment

     

  • Disparity in CBN’s rates may stifle exchange convergence – BDCs

    Disparity in CBN’s rates may stifle exchange convergence – BDCs

    The Association of Bureau de Change Operators of Nigeria (ABCON) has said that disparity in foreign exchange rates sold by Central Bank of Nigeria (CBN)  might stifle efforts at rates convergence and might lead to job losses.

    ABCON President, Alhaji Aminu Gwadabe, said this in an interview with the News Agency of Nigeria (NAN) on Thursday in Lagos.

    Gwadabe said that the CBN had continuously sold foreign exchange to BDCs, Travelex, and commercial banks at different rates and this could be used by speculators to distabilise the market.

    “The CBN sells dollars to BDCs at N381 and are expected to sell at N399, while the CBN sells dollar to Travelex, also a BDC and banks at N315 and are expected to sell at N375.

    “While Travelex and banks are expected by a CBN circular to settle such transactions at a rate not exceeding 20 per cent above the interbank market rate, BDCs only sell at five per cent margin.

    “Twenty per cent profit margin from FOREX is the highest in the world, ’’Gwadabe said.

    According to him, recent development at the foreign exchange market has shown that if the CBN does not eliminate the disparity in rates prevalent at the market, BDCs will be technically hedged out of the market.

    Gwadabe  said that hedging out about 3, 200 CBN registered BDCs from the foreign exchange market would lead to over 30, 000 job losses in an economy that was gradually recovering from recession.

    He said that his members were already losing customers due to the challenge of rate disparity as naira continued to appreciate against the dollar at the parallel market.

    Gwadabe appealed to the CBN to urgently see that the rates were harmonised to save a critical section of the nation’s  foreign exchange market.

    The ABCON chief said that as far as street hawkers were still plying their trade, rate convergence would be a mirage.

    The financial expert said that the CBN could achieve rate convergence if there was sustained liquidity in the market, adding that a fair level playing ground for all operators would also lead to rate convergence.

    NAN reports that the CBN rose from its last Monetary Policy Committee (MPC) meeting with a vow to see rates convergence at the nation’s FOREX market. (NAN)

  • CBN Deputy Governor Alade retires

    CBN Deputy Governor Alade retires

    Central Bank of Nigeria’s (CBN) Deputy Governor, Economic Policy and one time Acting governor of the apex bank, Dr. Sarah Alade has retired.

    Speaking at the send-off dinner organised by the members of the Economic Policy Directorate of the CBN, the Governor of apex bank, Godwin Emefiele described her departure as “not very happy” for him.

    He said Dr. Alade was not just a friend but a colleague and a moderating force who pulled him back from losing his cool during tense moments at the bank.

    Emefiele described Alade’s 23 years at the bank as excellent and a good representative of ladies at the CBN, noting that it will be difficult to fill the vacuum her departure will create.

    He praised her for bowing out when the ovation was loudest and for  her contribution to learning in the apex bank and outside. The bank, he said, will continue to pray for her in her private capacity and will also seek her expertise from time to time to guide them.

    Mrs. Sarah Omotunde Alade was appointed Acting CBN Governor  on February 20, 2014.

    Dr. Alade was a member of the Technical committee of the Vision 2010 and currently a member of the Technical Committee of Vision 2020 and member of the National Economic Management Team (EMT).

    As Deputy Governor, Economic Policy, Mrs. Alade superintended over the Economic Policy Directorate, comprising the Research, Monetary Policy, Trade and Exchange, Statistics Departments and Financial Markets Department.

  • Theft of CBN’s N8bn: 2 bankers bag 18 years

    Theft of CBN’s N8bn: 2 bankers bag 18 years

    A Federal High Court sitting in Ibadan has sentenced a Central Bank of Nigeria staff, Philip Togun, and a woman, Esther Afolabi, ex-staff of WEMA Bank to 18 years imprisonment for participating in stealing of N8 billion at CBN Ibadan branch.

    They were arraigned for conspiracy, conversion, forgery, re-circulation of mutilated currencies and stealing CBN’s  N8 billion by the Economic and Financial Crimes Commission (EFCC).

    The News Agency of Nigeria (NAN) reports that Togun, a former Treasury Assistant at CBN Ibadan branch and Afolabi, have been standing trial since 2015  alongside others.

    The other accused persons standing trial with the convicts are Kolawole Babalola, Muniru Olaniran, Festus Adeyemi, Yusuf Fatai, Olukunle Sijuwade, Emanueal Ordia and Patient Okoro.

    Two others — Ademola Oni and Tope Akintade —  had earlier opted for plea bargain and were similarly sentenced upon fulfillment of the terms of the plea bargain.

    A few other accused persons have also reached advanced stages in their plea bargain with the EFCC.

    Sentencing Togun and Afolabi, Justice Joyce Abdulmaleek held that she adopted the plea bargain agreement entered into by them with the EFCC  as basis for her judgment.

    “I hereby convict the fourth accused person, Philip Togun, for counts 15, 17 and 19 respectively and convict the fifth accused person, Esther Afolabi, for counts 16, 18 and 19 respectively.

    “Togun is sentenced to three years in prison for each of the three counts of 12 calendar months a year to commence from Jan. 1, 2016.

    “The convict shall forfeit to the Federal Government of Nigeria the following assets found in his possession; a building located in Ibadan and the money in the two bank accounts operated by the convict.

    “Afolabi is also sentenced to three years imprisonment for each of the three charges, 12 calendar months of the year, commencing from Jan. 1, 2016.

    “The convict shall forfeit the following assets which are the proceeds of the crime to the Federal Government of Nigeria — a five-bedroom duplex, a filling station, the entire money scattered across seven different bank accounts in Nigeria,” the judge ruled.

    Abdulmaleek, however, said that the sentences would run concurrently.

    However, the two defense counsel, Mr Olalekan Ojo and Mr Adewole Olajire, expressed dismay with the sentences.

    They said the judge did not consider the date when the convicts were arrested and also did not give full consideration to the plea bargain between the two convicts and the EFCC.

    Shortly before the judgment was delivered, the lawyers had pleaded with the court to temper justice with mercy in sentencing the former bankers. (NAN)