Commercial banks ‘suspend’ forex transactions; this is why
The forex illiquidity facing commercial banks is getting stiffer, due to the Central Bank of Nigeria’s failure to reimburse them. The commercial banks had helped the regulator meet users’ demand for forex, totaling $10billion.
Former CBN’s Governor Folashodun Sonubi said recently that the apex bank had taken steps to structure the debts owed the commercial bank. He equally promised the CBN was “working towards clearing them in the next one or two weeks.”
According to Punch, “multiple top bank executives” whom it failed to name told it the CBN’s failure to keep its word had made “suspend” granting forex for varied purposes “including school fees and Personal Travel Allowance applications.”
The report also alleged commercial banks are turning to parallel forex market operators for them to meet their obligations to customers.
“Unfortunately, the situation has worsened our FX position, making many banks to put some FX demands of their customers on hold,” the report quoted a bank executive as saying anonymously.
The vagaries of exchange rates has consistently troubled Nigeria’s currency (naira) as it slipped behind the dollar on Friday, staying at between N995 and N980 per dollar. In Lagos, Abuja and Kano, naira exchanged for a dollar as high as 1,000/$ on Saturday.
