Forex

CBN Writes Banks, Requests for accounts Without BVN

Published

6 years ago

November 13, 2017

CBN Writes Banks, Requests for accounts Without BVN

The Central Bank of Nigeria has written a letter to the Deposit Money Banks in the country, asking them to submit list of customers and bank accounts without bank verification number.

The letter came after a Federal High Court in Abuja ordered the CBN and 19 banks to freeze accounts without the BVN and got an interim order seeking the forfeiture of deposits in the accounts without the BVN, among others.

A good number of the DMBs, if not all, have complied with the directive from the CBN, according to top bank officials, who spoke to our correspondent on Sunday under the condition of anonymity because they were not authorised to speak on the matter.

Shortly after the November 3 deadline given by the court, commercial banks had started the compilation of bank accounts without the BVN.

However, the DMBs are also lobbying the Office of the Attorney General of the Federation to back down on the plan by the Federal Government to seize monies in the bank accounts of customers without the BVN.

A Federal High Court in Abuja had on October 17 ordered the forfeiture of all monies in bank accounts owned by corporate organisations, government agencies and individuals without the BVN.

The forfeiture order, which was issued by Justice Dimgba Igwe, while ruling on an ex parte application filed by the Federal Government through the Office of the Attorney General of the Federation, is not final yet.

The owners of the accounts had 14 days to claim ownership of same and show cause why the amounts in them should not be permanently forfeited to the Federal Government.

The court also ordered the banks to advertise the accounts without the BVN in a widely circulated national newspaper as notice to those who might have any interest in them.

Justice Dimgba adjourned until November 16 for the hearing of the substantive application seeking the forfeiture of the sums in the accounts without the BVN.

However, the 19 DMBs named in suit have engaged the services of a top law firm to address the matter, according to top banking industry sources.

Already, the law firm has approached the court for an extension of time to appeal the court order.

Top bank executives privy to the development had told our correspondent last week that all the affected lenders were ready to appeal the court order and had instructed the law firm to file for an extension of time to do so.

“All the banks are ready to appeal the court order. We have engaged the services of a law firm to begin that process. The legal firm is expected to have filed the papers for an extension of time at the court. This will help us prepare for the proposed appeal,” a top executive of a tier-1 bank told our correspondent under the condition of anonymity last Monday.

The court gave the order on October 17 following an application that was filed on September 28.

Justice Dimgba also ordered the banks to file an affidavit of disclosure before the court, showing the names of the affected accounts, the account numbers, outstanding balances, domiciliary accounts and the bank branches where the accounts were domiciled.

Banks did not official provide details of their plan on the BVN matter.

Some, however, told our correspondent they had complied with all regulatory requirements on the BVN matter.

Spokesperson for First Bank of Nigeria Limited, Mr. Babatunde Lasaki, said, “The bank will do what needs to be done on the BVN matter and we will comply with all regulatory requirements on the matter.”

The Head, Corporate Communications, Skye Bank Plc, Mr. Rasheed Bolawinwa, said, “As a regulatory-compliant bank, Skye Bank has complied with the expectations of the regulator concerning the issue of the BVN.”

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Forex Weekly Outlook November 13-17

Samed Olukoya

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Naira

Naira’s Upsurge Strains Nigeria’s Foreign-Exchange Reserves

Published

16 hours ago

April 17, 2024

Samed Olukoya

As the Nigerian Naira continued to rebound from its record low against its global counterparts, the nation’s foreign exchange reserves has been on the decline, according to the data published by the Central Bank of Nigeria (CBN) on its website.

CBN data showed liquid reserves have plummeted by 5.6% since March 18 to $31.7 billion as of April 12, the largest decline recorded over a similar period since April 2020.

The recent surge in the Naira follows a series of measures implemented by the Central Bank to liberalize the currency market and allow for a more flexible exchange rate system.

These measures included devaluing the Naira by 43% in January and implementing strategies to attract capital inflows while clearing the backlog of pent-up dollar demand.

Charles Robertson, the head of macro strategy at FIM Partners, acknowledged the Central Bank’s efforts to restore the Naira to a realistic exchange rate, suggesting that it aims to stimulate investment in the local currency and enhance liquidity in the foreign exchange market.

Despite the rapid depletion of foreign-exchange reserves, Nigeria still maintains a significant cushion, bolstered by a rally in oil prices and inflows from multilateral loans.

Gross reserves of approximately $32.6 billion provide coverage for about six months’ worth of imports, according to the International Monetary Fund.

The Central Bank’s disclosure last month that it had cleared a backlog of overdue dollar purchase agreements, estimated at $7 billion since the beginning of the year, indicates progress in addressing longstanding currency challenges.

However, uncertainties remain regarding the extent of dollar debt retained by the Central Bank as revealed by its financial statements late last year.

Furthermore, the decline in foreign-exchange reserves persists despite a surge in inflows into Nigeria’s capital markets, driven by interest rate hikes and increased attractiveness of local debt.

Foreign portfolio inflows exceeded $1 billion in February alone, contributing to a total of at least $2.3 billion received so far this year, according to central bank data.

Analysts remain cautiously optimistic about the trajectory of Nigeria’s foreign-exchange reserves, anticipating stabilization or potential growth fueled by anticipated inflows from Afreximbank, the World Bank, and potential eurobond issuance.

Also, the resurgence of oil prices and the expected return of remittances through official channels offer prospects for replenishing reserves in the near future.

Naira

Dollar to Naira Black Market Today, April 17th, 2024

As of April 17th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,50 NGN in the black market, also referred to as the parallel market or Aboki fx.

Published

17 hours ago

April 17, 2024

Samed Olukoya

As of April 17th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,50 NGN in the black market, also referred to as the parallel market or Aboki fx.

For those engaging in currency transactions in the Lagos Parallel Market (Black Market), buyers purchase a dollar for N1,70 and sell it at N1,060 on Tuesday, April 16th, 2024 based on information from Bureau De Change (BDC).

Meaning, the Naira exchange rate improved when compared to today’s rate below.

This black market rate signifies the value at which individuals can trade their dollars for Naira outside the official or regulated exchange channels.

Investors and participants closely monitor these parallel market rates for a more immediate reflection of currency dynamics.

How Much is Dollar to Naira Today in the Black Market?

Kindly be aware that the Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, commonly referred to as the black market.

The CBN has advised individuals seeking to participate in Forex transactions to utilize official banking channels.

Black Market Dollar to Naira Exchange Rate

Buying Rate: N1,050
Selling Rate: N1,040

Naira

Naira Appreciates to N1,136/$ Officially, N1,050/$ Parallel Market

Published

2 days ago

April 16, 2024

Samed Olukoya

The Nigerian Naira appreciated to N1,136 against the United States Dollar at the official market and rose to N1,050 at the parallel market.

At the official foreign exchange market, data from the FMDQ Exchange revealed that the Naira strengthened by 6.1 percent or N69 from its previous rate of N1,205/$ recorded on Friday to N1,136/$ on Monday.

This surge underscores the effectiveness of recent foreign exchange directives implemented by the Central Bank of Nigeria (CBN), aimed at stabilizing the Naira and bolstering liquidity in the market.

At the parallel market, the Naira appreciated to N1,050 against the Dollar, reflecting an improvement in the currency’s value in informal trading circles.

This resurgence has brought renewed hope to traders and businesses operating in the informal sector, as they anticipate further strengthening of the Naira in the coming days.

The improved exchange rate follows a series of strategic interventions by the CBN to address foreign exchange challenges and stabilize the Naira.

The positive momentum in the forex market has been further reinforced by a surge in total inflows into the Nigerian Autonomous Foreign Exchange Market (NAFEM), which increased by 41.7 percent to $3.75 billion in March, compared to $2.64 billion in February.

Commenting on the recent developments, analysts at Afrinvest expressed optimism about the continued strengthening of the Naira, attributing it to the CBN’s intensified efforts to bolster liquidity in the market.

They anticipate further improvements in the exchange rate as the apex bank maintains its proactive stance on forex management.