CBN To Sanction Banks For Non-Compliance With Retail FX Transactions Directive

CBN To Sanction Banks For Non-Compliance With Retail FX Transactions Directive

SHARE:

Post Views: 159 • Intervenes With A Further $545m The Central Bank of Nigeria (CBN) on Monday expressed displeasure at the failure the nation’s banks ...

Emefiele Tasks Agencies On FSS2020 Implementation
Bears Sustain Grip On Nigerian Equities Amidst Wait For Unusually Positive News
CBN Holds Benchmark Rate at 14% For 7th Consecutive Meeting

• Intervenes With A Further $545m

The Central Bank of Nigeria (CBN) on Monday expressed displeasure at the failure the nation’s banks to fully comply with its March 3, 2017 directive that they should, among other things, open teller points for retail forex transactions and have electronic display boards in all their branches, showing rates of all trading currencies.
A statement by the CBN therefore directed erring banks to remedy the situation within four weeks or risk stiff regulatory sanctions.
The latest CBN circular signed by its Director, Banking Supervision, Ahmad Abdullahi, gave the banks up till October 13, 2017 to comply fully with the directive, after which they would be barred from all future foreign exchange interventions.
The CBN had in its March 2017 directive 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 circular had 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.
The objective, it explained, was to create awareness among members of the public regarding the availability of such facilities in bank branches at clearly disclosed prices.
Meanwhile, the apex bank also on Monday sustained its intervention in the various sectors of the inter-bank forex market by injecting a fresh $545m into the various segments of the market.
A breakdown of the latest forex injection, according to a statement by Acting Director, Corporate Communications of the CBN, Isaac Okorafor, revealed that the retail Secondary Market Intervention Sales (SMIS) received the lion’s share of $285m.
Other components of the intervention included the $100m offered for wholesale SMIS, $90m for the Small and Medium Enterprises (SMEs) window and $70m for invisibles such as Basic Travel Allowances, tuition fees and medical payments.
According to Okorafor, the intervention 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 expressed the optimism of the CBN’s management about achieving a convergence between the forex rates at both the inter-bank and BDC segments.

COMMENTS

WORDPRESS: 0
DISQUS: 0