Despite pledging to pay more than $10 billion in foreign exchange commitments to Deposit Money Bank more than two weeks ago, the Central Bank of Nigeria’s primary bank has yet to do so.
On Friday and Saturday, Bureau De Change agents in Lagos, Abuja, and Kano sold the naira for between 990 and 995 dollars.
On the Investor & Exporter FX window, however, the naira climbed on Friday, rising to 747.76/$ from 772.98/$ on Thursday.
The immediately prior acting CBN Governor, Folashodun Shonubi, said on September 6, 2023, that all foreign exchange backlogs would be addressed within one to two weeks after the apex bank finished discussions on dollar liabilities with commercial banks.
He said that the CBN had agreed to repay the lenders within one or two weeks as a result of prolonged debt restructuring negotiations.
“In response to inquiries about backlogs, banks have been collaborating with the CBN on various clearing structures.” So, when they reach adulthood, they make the foreign exchange available to people in need.
“We’re talking with them about how to structure their own.” As a result, we are attempting to clear them within the next one or two weeks. “It’s something we’ve been talking about for a while,” Shonubi said during a forum in Lagos.
The development had placed banks in a highly tight FX liquidity position, forcing several lenders to temporarily halt many FX transactions, including school fees and Personal Travel Allowance applications.
According to the findings, the situation has also deteriorated dollar liquidity on the parallel market, as bank customers have shifted to the illicit market to meet their FX needs.
“The FX backlogs have not cleared. The promise has not been made good. We are hoping that the new CBN governor will begin a discussion with banks on it or clear them immediately,” the executive director of a commercial bank told one of correspondents on condition of anonymity.
Also, a top official of Tier-2 bank privy to the development, said,
“We have yet to see the FX backlogs cleared including the overdue forward contract obligations. We don’t know when this will be cleared. Unfortunately, the situation has worsened our FX position, making many banks to put some FX demands of their customers on hold.”
The overall amount of forward contract debt owing by the CBN was estimated to be $6.84 billion in a report by the American lender JPMorgan. However, the report has been rejected by the CBN.
According to reports, the apex bank and banks had contracts and dollar swap arrangements worth over $10 billion.