CBN floods market with $100m, to get tough with erring banks

In an apparent move to safeguard the interest of customers seeking to purchase foreign exchange for personal obligations and checkmate any attempt at causing panic in the market, the Central Bank of Nigeria (CBN) has released the sum of $100 million into the Nigerian Forex market. The release, which is coming barely 24 hours after the Bank injected $210 million into the wholesale segment of the market, is aimed at accommodating the spike in the seasonal demand for foreign exchange to meet various personal obligations, particularly pilgrimage.

Furthermore, it was learnt that the CBN plans to inject more United States Dollars into the foreign exchange market in the coming days, to checkmate any attempt to trigger artificial scarcity of the greenback. Confirming the release, the Bank’s Acting Director, Corporate Communications, Isaac Okorafor said the move had become necessary in order to protect customers from the activities of speculators who might want to capitalize on the increase in demand for foreign exchange at this time to make brisk gains.

While noting that the CBN had sufficient foreign exchange to meet genuine needs, Okorafor cautioned dealers against speculation, warning that they stood to lose much if they chose to hoard currencies in anticipation of a spike and a depreciation in the value of the naira. It will be recalled that the CBN on Wednesday, May 23, 2018, frowned at the action of some banks that reportedly refused to sell forex to customers requiring the currency for the purpose of pilgrimage or Personal and Business Travel Allowance (PTA/BTA).

Meanwhile the apex bank has warned banks turning back customers that come to purchase BTA/PTA and forex for pilgrimage. It said “We hereby appeal to bank customers to go straight to their banks to buy forex as the CBN has supplied enough dollars to the Banks to meet needs in the invisibles segment. Customers are hereby enjoined to report any bank that refuses to attend to their legitimate demands within 24 hours. Please, call 07002255226. Isaac Okorafor, Ag. Director, Corporate Communications