No Plan To Convert Domiciliary Account Holdings Into Naira – CBN

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CBN

CBN says no plan to convert domiciliary accounts to Naira over forex -

Olusola  Bello

The Central Bank of Nigeria (CBN) has asked Nigerians to ignore reports that domiciliary account operators have been directed to convert their holdings into naira.

In a statement on Saturday, CBN’s Director of Corporate Communications, Osita Nwanisobi, said the purported directive was not from the bank.

According to him, the nation’s financial regulator is aware of a circular with a fake CBN logo issuing the said directive to Deposit Money Banks (DMBs), International Money Transfer Operators (IMTOs), and members of the public.

Nwanisobi stressed that the CBN did not plan such a line of action and would have no reason to make a decision of such, saying the directive was intended to cause panic in the foreign exchange market.

“We wish to reiterate that the Bank has not contemplated, and will never contemplate, any such line of action. The speculation is a completely false narrative aimed at triggering panic in the foreign exchange market,” he said.

The CBN spokesman, therefore, appealed to domiciliary accounts operators and members of the banking public to go about their legitimate foreign exchange transactions.

He asked them to be mindful of misleading circulars, adding that any circular issued by the bank would be posted on its website (www.cbn.gov.ng).

Nwanisobi warned against the unauthorised use of the CBN logo, saying appropriate authorities were already making efforts to apprehend those behind the misleading circular.

 

Speculative trading however at the weekend intensified at the parallel market of the foreign exchange market at the weekend, as the naira inches towards N550/$ amidst rising scarcity.

 

What looked like an awful week for the local currency deteriorated in the past two days, with the exchange rate floating around N545/$ in Lagos Friday afternoon.

 

Findings have shown that many traders at the black market have run out of FX, while the few that have are not willing to sell. The traders, it was learnt, are currently on a mop up, a situation that has turned the black market segment into a sellers’ market.

 

If the speculative tendency continues into this week, traders said, the troubled naira could hit a new low of N600/$. Supply shock continues to increase, and the dollar only needs to break the N550/$ psychological barrier to head towards N600/$.

 

The naira is stabilising above N500/$ for the first time. It exceeded N500/$ during the famous 2017 crisis, but it retreated shortly after it crossed the mark.

 

The Guardian,at the weekend reported that the deposit money banks (DMBs) that have been handed the sole responsibility of selling to personal/business travel allowance (PBTA) users after the ousting of bureau de change (BDC) operators, have resorted to rent-seeking.

 

It reported that the banks are exploring the black market, while denying end-users access to FX under the guise of unacceptable documentation. Meanwhile, the banks have continued to claim that they have more than enough to give out to those in genuine need.

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