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Sell excess dollars in 24 hours, CBN orders banks

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Sell excess dollars in 24 hours, CBN orders banks

The Central Bank of Nigeria, CBN, has ordered Deposit Money Banks to sell their surplus dollar stock by February 1, 2024, as part of new measures to stabilize the country’s fluctuating currency rate.

The CBN, which made the announcement in a fresh circular issued on Wednesday, also urged lenders not to hold extra foreign currency for profit.

According to officials, the central bank believes that some commercial banks have long-term foreign exchange positions to profit from the erratic swings of exchange prices.

The new circular introduces a set of guidelines aimed at reducing the risks associated with these practices.

In the circular titled, “Harmonisation of Reporting Requirements on Foreign Currency Exposures of Banks”, the CBN raised concerns over the growing trend of banks holding large foreign currency positions.

The latest circular came barely 48 hours after the CBN released a circular, warning banks and FX dealers against reporting false exchange rates, among others.

The new development also came on the heels of the adjustment of the methodology used for the calculation of the nation’s official exchange rate by the FMDQ Exchange.

The review has pushed the Nigerian Autonomous Foreign Exchange Market rate (official exchange rate) from approximately N900/dollar to N1,480/dollar. The naira closed at 1,450/dollar at the parallel market on Tuesday.

The move which is aimed at unifying the official and parallel market exchange rates has been hailed by economists and other stakeholders.

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They however challenged the CBN to clear FX backlogs estimated at over $5bn and also fund FX demands at the official market. This, they said, would forestall a situation whereby the parallel market rate would move away from the official rate again.

Apparently as part of the moves to fund FX request at the official window, the CBN in its latest circular released on Wednesday accused banks of holding excess foreign exchange positions.

As a result, the central bank gave lenders until February 1, 2024 (today) to sell off excess dollar positions.

The circulated, dated January 31, 2024, was signed by the Director, Trade and Exchange, CBN, Dr. Hassan Mahmud, and representative of the Director, Banking Supervision, CBN, Mrs. Rita Sike.

The circular read in part, “The Central Bank of Nigeria has noted with concern the growth in foreign currency exposures of banks through their Net Open Position (NOP). This has created an incentive for banks to hold excess long foreign currency positions, which exposes banks to foreign exchange and other risks.”

To address these issues, the CBN in the circular issued prudential requirements that banks must follow. A key focus of these requirements is the management of the Net Open Position (NOP).

The NOP measures the difference between a bank’s foreign currency assets (what it owns in foreign currencies) and its foreign currency liabilities (what it owes in foreign currencies).

The circular mandates that the NOP must not exceed 20 per cent short or 0 per cent long of the bank’s shareholders’ funds.

This calculation, the apex bank said, must be done using the Gross Aggregate Method, which provides a comprehensive view of the bank’s foreign currency exposure.

Furthermore, banks with current NOPs exceeding these limits are required to adjust their positions to comply with the new regulations latest by February 1, 2024.

Additionally, banks must calculate their daily and monthly NOP and Foreign Currency Trading Position (FCT) using specific templates provided by the CBN.

The CBN also directed banks to maintain adequate stocks of high-quality liquid foreign assets, such as cash and government securities, in each significant currency.

According to the circular, all banks are required to adopt adequate treasury and risk management systems to provide oversight of all foreign exchange exposures and ensure accurate reporting on a timely basis.

Banks are expected to bring all their exposures within the set limits immediately and ensure that all returns submitted to the CBN to provide an accurate reflection of their balance sheets.”

Finally, the CBN warned banks that non-compliance with the NOP limit would result in immediate sanction and suspension from the foreign exchange market.

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In the half of 2023, First Bank, UBA, Zenith, Access, and GTB reported a combined N1.38tn in forex revaluation gains.

The apex bank at the time issued a directive instructing commercial banks to resist using their foreign exchange revaluation gains for dividends and operational expenditures. It noted that “Banks that exceed the NOP prudential limits due to the FX revaluation shall be granted forbearance for the breach upon application.’’

A top bank executive, who spoke on condition of anonymity, said the new circular would force banks to sell off excess dollar liquidity exceeding $5bn.

The top banker said, “Just as some Nigerians prefer to keep their money in dollars because naira is not a good store of value, banks also hold excess dollar liquidity to make gains. They do their own at institutional level. What the CBN is saying with this new circular is that, you cannot hold excess dollar liquidity again. Any foreign exchange you are holding must be committed to something, a transaction or obligation you can proof. Banks have made a lot of revaluation gains. Some banks, I believe, got approval under the last administration to hold more dollar than the requirement. The idea is that if banks sell all these excess dollars, there will liquidity and the exchange rate will stabilise. Foreign investors will come in.”

Naira trades

Meanwhile, the naira closed at N1,455.59/$ at the official window on Wednesday, according to the FMDQ Securities Exchange. This is a 1.82 per cent appreciation from the N1482.57/$ it closed trading on Tuesday.

At the parallel market, it lost N61 to trade at N1,511/$. A Bureau De Change operator, Malam Ibrahim, told The PUNCH, “For now, we are selling between N1,511/$ and N1,512/$. Earlier today, the dollar was sold between N1,535/$ and N1,540/$.”

Another operator said he could only sell at N1,510/dollar. However, a source at the market informed our correspondent of a ‘no sales policy’ to be implemented by the BDC union tomorrow.

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The source said the decision was taken today after serious deliberations on how to reduce the fall of the naira.

“Nobody is coming to market tomorrow. We want to close the market because honestly, the naira is just crashing anyhow. This was caused by some media reports this week that the dollar was now selling for N1,500 even though we were still selling at N1,400. Now everybody is blaming black market operators and that’s why we decided that the market will remain closed tomorrow,” the source said.

“We will resume next tomorrow, and the rate should be less than N1,400/$,” the source added.

On the cryptocurrency peer-to-peer market, the naira was trading for N1,495.1/$ on Binance’s P2P platform as of the time of filing this report.

The naira is recording its worst week on the official market following the move by FMDQ Securities Exchange to revise the methodology used to set the exchange rate. According to a market notice, this new calculation will attempt to narrow the gap between the official and parallel rates of the naira.

It said, “This revision aims to address recent fluctuations and challenges encountered in the Nigerian Foreign Exchange (‘FX’) Market.”

It added, “These revisions are focused on enhancing the accuracy and reliability of the NAFEX and NAFEM rates determination process, with a focus on data availability and integrity involving a rigorous data validation process, including tolerance checks which shall be applied by FMDQ Exchange, subject to internal policies and procedures.”

Sell excess dollars in 24 hours, CBN orders banks

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Coscharis Motors clinches Nigeria’s Multi-Luxury Company Award as Range Rover Autobiography emerges Luxury SUV

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Mrs. Julie Chi - Nwaoha, Publisher, On the Highway Africa; Mr. Abiona Babarinde, General Manager, Marketing and Corporate Communications, Coscharis Group; Mr. Segun Sobogun, Marketing Communications Executive, Coscharis Group; Mr. Frank Kintum, Publisher, Transport Day during the presentation of the Multi - Luxury Company of the Year award to Coscharis Motors at this year’s Nigeria Auto Journalists Association annual awards night held recently at the Oriental hotels, Lagos.

Coscharis Motors clinches Nigeria’s Multi-Luxury Company Award as Range Rover Autobiography emerges Luxury SUV

 

It is a double honour for Coscharis Motors Plc, one of the subsidiaries of the respected conglomerate, Coscharis Group, as it was declared Multi-Luxury Company of the Year and one of its iconic luxury brands, Range Rover Autobiography, was adjudged the Nigeria’s Luxury SUV of the Year at the 2024 edition of the Nigeria Auto Journalists Association Awards.

The well attended event was held recently at the prestigious Oriental Hotels, Lagos.

Coscharis Motors, a household name in topnotch globally respected luxury automobile brands in Nigeria, has been the exclusive representative of the British iconic luxury brand of the Jaguar Land Rover and the German pride in the luxury segment of the BMW brand over many decades.

The company in 2023 added another new luxury brand from United Kingdom into the Nigeria market which is the Grenadier from the Ineos group in UK. The Grenadier is a brand new product globally which is equally being represented in Nigeria by Coscharis Motors as a new addition to its existing ‘House of luxury’ when it comes to automobile of repute.

The luxury SUV category was keenly contested with other tested luxury brands but the Range Rover Autobiography came tops, according to the organizers, after strong consideration of the market acceptance of the Autobiography in all ramifications.

The All New Range Rover Autobiography variant is revolutionary, reliable and a class on its own with its special appeal, style that resonates with its priority audience when it comes to luxury, class, comfort and performance.

Receiving the award on behalf of Coscharis Motors, the General Manager, Marketing and Corporate Communications, Coscharis Group, Mr. Abiona Babarinde, dedicated the award to all the Coscharis Motors customers, especially the luxury brand enthusiasts for their acceptability of all the luxury brands in the Portfolio namely the Jaguar Land Rover, BMW and the new Grenadier respectively as their preferred luxury automobile of choice.

He said, “These awards only reconfirm our expertise in delivering top notch luxury experience to our premium customers while maintaining the global standard of brand positioning to discerning customers in the ever dynamic Nigerian market.

“Representing these globally respected iconic brands over the years exclusively in Nigeria involves consistent delivering of value for money that involves the total luxury experience from the point of brand awareness to the purchase stage and the aftersales service experience to deliver the peace of mind required.”

Group Managing Director of Coscharis Motors Plc, Mr. Josiah Samuel, also dedicated the awards to the company’s ever loyal customers for their patronage and acceptance of the brands with a promise to continually create more value in the automobile industry in Nigeria.

He said, “There can’t be another best way to end the business year in 2024 than with these set of prestigious awards despite all the business challenges in the year and more importantly that the awards are coming from a very critical stakeholder / partner like the media.”

The award event attracted various stakeholders that are players in the automotive sector in Nigeria.

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Leadership by example: FRSC Corps Marshal leads field operations, patrol highways 

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L- R Hyginus Omeje , Assistant Corps Marshal, Operations, Bisi Kazeem, Deputy Corps Marshal rtd, and Shehu Mohammed , Corps Marshal, FRSC during the Corps Marshal's patrol operations visitation to Ondo State Sector Command, Akure, recently.

Leadership by example: FRSC Corps Marshal leads field operations, patrol highways 

By Bisi Kazeem

As the year winds down and Nigerians embark on end-of-year travels, the Federal Road Safety Corps (FRSC) has intensified its efforts to curb road crashes and ensure safer highways. Leading this charge is the Corps Marshal, Shehu Mohammed, who has set a sterling example of sacrificial leadership by actively participating in frontline operations during this critical period.

The end of the year is a notoriously perilous time on Nigeria’s roads, marked by increased traffic, heightened road traffic crash risks, and a surge in reckless driving.

However, under the proactive leadership of the Corps Marshal, the FRSC rolled out an unprecedented campaign to reduce road traffic crashes and fatalities, ensuring that the festive season is marked by joy rather than tragedy.

True leadership is not defined by words but by action. The Corps Marshal exemplifies this by personally leading field operations, patrolling highways, monitoring traffic flows, and directly engaging with road users.

His visible presence has reinvigorated the morale of FRSC officers and demonstrated to the nation that leadership is about service and sacrifice.

He defied insecurity on the highways and embarked on a traffic monitoring operation from Abuja, the Federal Capital, through Kogi, Ekiti, Ondo, Owo, Ore, down to Edo and Delta.

His decision to lead from the front underscores his commitment to the FRSC’s mission of saving lives and highlights the urgent need for compliance with traffic rules and regulations.

From the beginning of the Ember Months sensitisation campaign in September, the Corps had gone ahead of time, implementing series of robust measures aimed at addressing road safety challenges during the festive season. These remedies include; increased patrols and checkpoints as additional officers and vehicles have been deployed in strategic points on highways to monitor and enforce compliance with traffic laws; organised nationwide safety campaigns targeting speed violations, drunk driving, overloading and seatbelt use.

These campaigns educate drivers on the dangers of reckless behaviours and emphasize the importance of safe driving practices.

The Corps also ensured Emergency Response Preparedness: ambulances, tow trucks, and rescue teams are on standby to ensure rapid responses to emergencies, reducing fatalities and injuries in the event of crashes.

Knowing that the task of making the highways safe is a collective action, FRSC went into the season with strengthened partnerships with key stakeholders, including the Nigeria Police Force, transport unions, traditional rulers and local communities, to foster a united front in the battle against road crashes.

The Corps Marshal’s leadership has inspired not just his officers but also the general public.

His direct involvement sends a clear message that road safety is a shared responsibility requiring the commitment of all stakeholders.

The Corps Marshal’s hands-on approach during this critical period has not only motivated the FRSC team but has also restored public confidence in the agency’s commitment to saving lives,” said a motorist who witnessed the Marshal’s activities firsthand on the Niger Bridge.

The monitoring activities carried out across major corridors suggest that the intensified efforts are yielding positive results, with a noticeable reduction in road crashes and fatalities compared to previous years.

The Corps Marshal’s example of sacrificial leadership has brought renewed vigor to the FRSC’s operations, ensuring that every life is valued and protected.

Needless to state that the FRSC Corps Marshal, Shehu Mohammed, is indeed an enigma, a force to be reckoned with and a true example of practical leadership in public service as he leads yet again by example in the fight against road crashes in Nigeria.

Taking active front-line roles, dedicating to sacrificial leadership and willingness to take bold steps to address the challenges facing Nigerian roads.

By setting the pace, he’s inspiring his team and other stakeholders to join forces in the quest for safer roads in Nigeria.

As the festive season continues, let us all join the FRSC as they call on all Nigerians to support its efforts by adhering to traffic rules, avoiding risky driving behaviours, and prioritizing safety on the roads.

Together, with the leadership of the Corps Marshal and the dedication of FRSC personnel, a safer, accident-free festive season is achievable.

The Corps Marshal’s leadership reminds us all that effective leadership requires sacrifice, action, and a deep commitment to service.

As Nigerians embark on their journeys this season, they can take comfort in knowing that the FRSC is working tirelessly to make the roads safer for everyone.

 

*DCM Bisi Kazeem (Rtd), fsi MNIM anipr, a public relations expert and media guru writes from Lagos, Nigeria.

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FG deploys Lanre Shittu CNG buses as airport shuttle 

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FG deploys Lanre Shittu CNG buses as airport shuttle

 

The Federal Government has commenced the deployment of Lanre Shittu Motors (LSM)-branded  Compressed Natural Gas (CNG) buses in the nation’s airports for passengers shuttle.

The first batch of the CNG-powered buses has been launched at the Murtala Muhammed Airport, Lagos, at a ceremony attended by the Minister of Aviation and Aerospace Management, Festus Keyamo, and Managing Director, Federal Airports Authority of Nigeria (FAAN), Mrs Olubunmi Oluwaseun Kuku.

Speaking during the unveiling at the Lagos airport, the minister said the deployment was in line with the directive of President Bola Tinubu.

He said it was part of Nigeria’s commitment to reducing carbon emissions and meeting global climate targets.

‘’What you see here today is a fleet of CNG buses for FAAN to commence passenger movement at all our airports immediately,” the minister said.

He said the newly acquired CNG-powered LSM buses unveiled at the Lagos airport are eco-friendly with zero emission and designed with accessibility features for persons with disabilities.

The deployment, he added, was in compliance with the President’s goal of reducing reliance on traditional fossil fuels of petrol and diesel and promoting sustainable use of CNG to power vehicles in the country.

The introduction of the CNG to power automobiles is one of the Federal Government’s initiatives to ease the impact of fuel subsidy removal on the masses.

The CNG buses, according to the Managing Director of Lanre Shittu Motors, Taiwo Shittu, come in two specifications: a 31-seater for airport shuttle services and a 54-seater for mass transit city buses.

He said they had been equipped with modern amenities, including air conditioning, viewing screens, and charging stations.

With the introduction of the CNG buses, he said LSM aimed to provide a more sustainable and efficient transportation solution not only to Lagos but other parts of the country.

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