The Nation Newspaper

Tag: forex

  • Forex: CBN opens special window for SMEs

    Forex: CBN opens special window for SMEs

    The Central Bank of Nigeria (CBN) has opened a special Forex window for Small and Medium Enterprises (SMEs) to enable SMEs import eligible finished and semi-finished items.

    The CBN spokesman, Isaac Okorafor, in a statement on Monday in Abuja, said that the SMES would be permitted to import items not exceeding 20,000 dollars for an enterprise per quarter.

    He said that the Bank’s special intervention was necessitated by its findings that a large number of SMEs were being crowded out of the forex space by large firms.

    “The sum of 20,000 dollars per SME customer per quarter can be affected by telegraphic transfer subject to completion of Form ‘M’ supported with proforma Invoice and the importer’s Bank Verification Number (BVN).

    “All processing banks are to ensure that the importers submit relevant shipping documents not later than 60 days from the date of the transfer.

    “Information posted on the CBN website defines Small and Medium Scale Enterprises are enterprises that have asset base (excluding land) of between N5 million and N500 million and a labour force of between 11 and 300,” he said.

    Okorafor further disclosed that the Bank had begun the massive sale of foreign exchange in different sectors of the Forex market this week.

    He said that on Monday, the Bank intervened by offering 100 million dollars to authorised dealers at the forex auction in the interbank wholesale window.

    He said that 41 million dollars was also sold for BTA, PTA, medical and tuition fees.

    On the BDC segment, he said the Bank had sold 10,000 dollars each to BDCs to meet the needs of low-end users in the country.

    According to Okorafor, 99.544 million dollars was also picked up by dealers out of the 100 million offered by the Bank during the last wholesale auction on Friday.

    Meanwhile, operators in the Bureau De Change (BDC) segment has duly funded their accounts with the CBN in anticipation of picking up the dollar equivalent of 10,000 on Tuesday.

    Market analysts believe that the CBN may continue its special intervention in the market with the sale of more dollars to BDCs, thereby bringing down the price of Dollar.

  • Forex: CBN makes $10,000 special midweek sales to 2991 BDCs

    Forex: CBN makes $10,000 special midweek sales to 2991 BDCs

    The Central Bank of Nigeria (CBN) in its bid to sustain foreign exchange liquidity said it would make a special intervention forex sales of 10,000 dollars to each of the 2991 licensed Bureau de Change (BDC) on Thursday.

    The Acting Director, Corporate Communications, CBN, Mr Isaac Okorafor said this in a statement on Wednesday in Abuja.

    According to him, the aim of the special intervention is to meet the upsurge of forex requests of low-end customers, which has been on the sudden increase in the past few days.

    Okorafor said the special intervention does not in any way contradict the Bank’s newly amended sales policy of trading not more than 10,000 dollars to BDCs once a week.

    The News Agency of Nigeria (NAN) reports that the CBN had last week increased forex sales to BDCs from 8,000 dollars once a week, to 10, 000 dollars twice a week, amounting to 20, 000 dollars weekly per BDC.

    However, the CBN later changed its plans and decided to instead sell only 10,000 dollars once a week, which it did on Tuesday in order to reduce logistical difficulties.

    The BDC operators had expressed disappointment over the reversal.

    They said that 10,000 dollars a week was insufficient to meet forex demand at that segment, thus CBN plans to have a converged inter-Bank, BDC and parallel market rate may not be achieved. (NAN)

  • CBN to inject another $10,000 to BDCs

    CBN to inject another $10,000 to BDCs

    The Central Bank of Nigeria (CBN) will inject additional 10,000 dollars proceeds of International Money Transfer Services Operators (IMTSO) to 3135 Bureau De Change Operators nationwide, Alhaji Aminu Gwadabe says.

    Gwadabe, the President, Association of Bureau De Change Operators of Nigeria (ABCON) said this in an interview with the News Agency of Nigeria (NAN) on Wednesday in Lagos.

    According to him, the move by the CBN is to checkmate the activities of currency hoarders and speculators.

    NAN reports that the CBN had on Tuesday injected 10,000 dollars to BDCs nationwide.

    “Providing liquidity into the BDC subsector is the rat poison that will smoke the rat out of the hole in terms of speculation and hoarding.

    “The CBN’s action justifies its determination to continue to strengthen the Naira and get it out of the grips of speculators and hoarders,” Gwadabe said.

    The ABCON chief commended the “doggedness of the CBN in its interventions in the entire official window.

    NAN also reports that the CBN had on Monday vowed to stamp speculators out of the nation’s foreign exchange market through its interventions.

    The move by the CBN to rightfully explore the BDC window in stabilising the Naira exchange rate has shown the apex bank as a listening institution geared toward ameliorating the plights of FOREX end users.

     

  • CBN to meet forex requests of Airlines, manufacturing, others

    •$150m offer fully subscribed

    The Central Bank of Nigeria (CBN) yesterday said it will intervene in the retail auction window for forex sales to the airlines, manufacturing, agricultural and petroleum sectors. It said commercial banks have started submitting requests made by their customers to make purchases.

    The apex bank also said authorised foreign exchange dealers have fully subscribed to the $150 million it offered yesterday at the foreign exchange auction in the interbank wholesale window.

    The CBN also fulfilled its commitment to sell $10,000 to Bureaux de Change (BDCs) in line with its new sale policy.

    The CBN Acting Director of Corporate Communications, Isaac Okorafor, confirmed the sale in Abuja, just as he announced interventions in the retail auction window for forex sales to the airlines, manufacturing, agricultural and petroleum sectors.

    He added that banks have started submitting requests made by their customers to the CBN. It will be recalled that the CBN since February 21, 2017, has made over ten offers in the interbank wholesale market ranging from $100million to $500 million per auction. Dealers have fully subscribed to the last three auctions that ranged from $100 million to $150 million.

  • CBN continues forex liquidity boost with additional $240m

    CBN continues forex liquidity boost with additional $240m

    The Central Bank of Nigeria (CBN) on Monday continued boosting the country’s foreign exchange liquidity with 240 million dollars, part of which 150 million dollars will go to dealers in the interbank wholesale window.

    Those who stand to gain from the sales through the interbank wholesale auction window include manufacturers, importers of aggro-machineries, plants and critical raw materials.

    The Bank’s Acting Director, Corporate Communications, Mr Isaac Okorafor in a statement, said that the bank also released 90 million dollars to meet requests for invisibles such as travel allowances, medical and school fees.

    He said that henceforth, the apex Bank would sell 10,000 dollars only to low-end Forex dealers once a week rather than the bi-weekly sales it announced earlier.

    He said that the CBN had adjusted BDC sale days to Tuesdays only, to reduce logistic difficulties.

    According to Okorafor, the CBN has also directed all banks to pay cash over the counter to desiring foreign exchange customers to further ease the access of customers.

    He further urged customers to report any un-cooperating bank to the CBN through available platforms.

    The CBN, in the recent months, has made offers and releases of over 2 billion dollars to the inter-bank foreign exchange market in its bid to sustain Forex supply to different categories of users.

    Last week, the Naira began to weaken against the dollar, which was attributed to alleged hoarding of the dollars by commercial banks, in spite of receiving over 200 million dollars.

    The Naira on Friday closed at N394 to a dollar.

    It, however, later showed signs of recovery, when it sold at N388 to a dollar on Monday in Abuja. (NAN)

  • CBN warns bank CEOs over forex

    CBN warns bank CEOs over forex

    Bank chiefs caught frustrating efforts by the Central Bank of Nigeria (CBN) at getting more dollars to end-users risk severe punishment, the apex bank warned yesterday.

    The warning came on the backdrop of reports that lenders are setting difficult hurdles for foreign exchange (forex) end-users wanting to make purchases for Business Travel Allowances, Personal Travel Allowances, tuition payment abroad and medical bills.

    More than $2 billion has been injected by the CBN into the retail end of the forex market to meet demands by genuine users. The regulator deployed examiners and ‘mystery’ shoppers to the banks to monitor compliance with the intervention funds’ disbursement guidelines and possible abuse by the lenders.

    CBN spokesman, Isaac Okorafor confirmed that the regulator had received complaints from customers over frustrations which they were meant to go through in getting foreign exchange for invisible items.

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

    He urged the general public to report to it any bank that fails to meet customers’ needs after due documentation and reiterated the regulator’s determination to deal with any official or institution found to be sabotaging the operations of foreign exchange market in whatever guise.

    Yesterday’s warning came after a similar threat was made to banks mid-February, in which the CBN also threatened the bank officials with heavy sanctions.

    The statement reads: “Any bank that fails to comply with the rules of this and other extant forex guidelines shall be sanctioned, which will affect the executive and other officers of the bank,” CBN Director, Financial Markets Department, Alvan Ikoku said in circular to all banks.

    The apex bank explained that the forward sale by banks to their customers shall be for mature or past due obligations and should not exceed 60 days.

    It said the special intervention will be via a “wholesale bid” whereby commercial lenders will apply for a particular dollar amount as opposed to submitting individual customer demand. The lenders will then allocate the dollar to their customers, the CBN said in a mail to commercial banks, asking them to maintain the bid spread of 50 Kobo.

    “Successful banks shall send their returns to Financial Markets Department, 24 hours after the release of the intervention results. After release of the results, banks shall sell forwards to match the forward purchases from the CBN,” it said.

  • CBN to sustain forex intervention

    CBN to sustain forex intervention

    The Central Bank of Nigeria (CBN) on Sunday reiterated its determination to sustain the provision of foreign exchange 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.

    It would be recalled 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. (NAN)

  • Forex: New rate for BDCs out tomorrow-CBN

    Forex: New rate for BDCs out tomorrow-CBN

    THE Central Bank of Nigeria (CBN) will announce a new foreign exchange rate for licensed Bureaux de Change operators (BDCs) on Monday.
    Giving this hint at the weekend was Isaac Okorafor, the Acting Director, Corporate Communications of the CBN.
    Speaking in an interview with The Nation, Okorafor who confirmed this development however kept the new rate under wraps.
    “I don’t know the new rates yet but it would certainly be announced by Monday. That is the much I can say for now,” he said.
    The CBN spokesman had in a statement issued earlier said the apex bank hopes to commence sale of forex twice weekly to Bureaux de Change operators (BDCs) from Monday, said it was part of efforts to sustain liquidity in the foreign exchange market.
    Specifically, he said: “Licensed BDC operators are therefore required to fund their accounts with the CBN on Mondays and Wednesdays, while they receive their purchases on Tuesdays and Thursdays respectively.”
    Expatiating, he said: “The sale amount to BDCs is hereby increased to $10,000 weekly ($5,000 per bid).”
    The CBN had initially fixed N360 to a dollar, as the rate at which BDCs will be allowed to purchase greenbacks from International Money Transfer Organisations (IMTOs) and subsequently fixed the rate at which BDCs will sell dollars to end users at not more than N362/$1.
    Before the development, the country’s over 3,000 licensed BDCs were buying dollars from IMTOs under the supervision of the CBN at a rate of N381 to the dollar and selling at N399/$.
    The regulator had last Monday directed Deposit Money Banks (DMBs) to sell foreign exchange sourced from it to retail end-users at not more than N360/$1 for Personal/ Business Travel Allowance (PTA/BTA) and other invisibles even as it offered a fresh $100million in forwards.
    The CBN’s almost daily dollar sales have crashed dollar rates at the parallel market to about N375/$ and N365/$ in Lagos and Abuja respectively.

  • CBN optimistic of rates convergence at FOREX market– Emefiele

    CBN optimistic of rates convergence at FOREX market– Emefiele

    Mr Godwin Emefiele, Governor of the Central Bank of Nigeria (CBN) says the apex bank is determined to see the convergence of rates at the foreign exchange market.

    Emefiele said this while fielding questions from newsmen at the end of the Monetary Policy Committee (MPC) meeting of the CBN in Abuja on Tuesday.

    The CBN governor denied insinuations in some quarters that it was directed by the National Executive Council (NEC) to intervene at the FOREX market before it started injecting money into the interbank market.

    “NEC did not direct the CBN as is being insinuated in some quarters.

    “We have seen the trend and we took decision to revise it through our FOREX intervention,’’ Emefiele said.

    The governor said that the CBN was optimistic that the rate between the official and parallel market would converge further.

    When asked if the CBN could sustain the policy, Emefiele said that the bank had the capacity to take decisions and implement them.

    He noted that the nations’ foreign reserves had improved further to 31 billion dollars.

    The News Agency of Nigeria (NAN) reports that the MPC rose from its meeting with a retention in the Monetary Policy Ratio (MPR), Cash Reserve Ratio (CRR) at 22.5 per cent and liquidity ratio at 30 per cent.

    Since February when the CBN started its intervention at the interbank market, it had injected more than 1.5 billion dollars, and the Naira had extended its gains against the dollar.

    To further sustain its intervention at the market, the apex bank injected another 180 million dollars on Monday to meet the needs of schools, medicals, business and personal travel allowances.

    NAN reports that in January, the Association of Bureau De Change Operators of Nigeria (ABCON) appealed to the CBN to ensure rate convergence as well as eliminate the multiplicity of rates in the market.

    Meanwhile, the Naira had continued to appreciate at the parallel market, exchanging at N420 (buying rate) and N430 (selling) on Tuesday afternoon.

    The Pound Sterling and the Euro closed at N530 and N450 respectively.

  • FOREX: CBN releases another $180m

    The Central Bank of Nigeria (CBN) has offered additional 180 million dollars to meet bids for
    wholesale auction and requests for
    invisibles such as medicals, school fees
    and personal travel allowances valued
    at 80 million dollars through the inter-
    bank window.
    In a statement, on Monday in Abuja,
    the CBN’s acting Director, Corporate
    Communications, Mr Isaac Okorafor,
    said the wholesale requests will be
    settled on Tuesday, March 21, 2017.
    He said that with the development, it is
    expected that the Naira would further
    strengthen in the foreign exchange
    market in the days to come.
    He reiterated that the CBN would
    ensure sustainable forex liquidity and
    transparency in the process to enable as
    many customers as possible get access
    to the foreign exchange they genuinely
    demand.
    He advised eligible individuals with
    genuine foreign currency needs to
    freely approach their banks and
    authorised dealers with their request,
    stressing that the CBN has made
    adequate provisions of foreign currency
    for all such legitimate purposes.
    Okorafor further advised legitimate
    customers to approach the CBN with
    their complaints should they be unfairly
    denied access.
    Tte Bank had since February 2017
    offered over S1.5 billion to the
    interbank market, with the aim of
    bringing stability to the foreign
    exchange market and providing easy
    access of businesses and individuals
    to foreign currencies.
    Meanwhile the Naira has continued to
    firm up against the Dollar at the
    parallel market. The Naira today traded
    at N445 to a dollar
    The Naira has also continued to
    appreciate against the Pound Sterling,
    trading at N530 and N465, to one Euro.
    At the Bureau De Change (BDC)
    window, the Naira traded for N399 to a
    dollar, while a Pound Sterling and Euro
    changes for N580 and N525,
    respectively.
    The Nigerian currency also closed at
    N307.5 at the interbank market.(