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Transactions on FX Investor Window Hit $2.2bn – CBN

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  • Transactions on FX Investor Window Hit $2.2bn

The Central Bank of Nigeria on Thursday said its new currency window for investors had handled $2.2bn of trade in six weeks.

The CBN also said it accounted for almost 30 per cent of the $2.2bn transactions, adding that this was meant to keep the window operating.

The CBN had about six weeks ago created the Investors & Exporters FX Window to attract foreign investors and at same time maintain a strong currency to ward off inflation.

Analysts and experts have lauded the initiative as a right step in the right direction.

However, some experts including a former Governor of the CBN, Prof. Charles Soludo, said although the initiative among others taken by the regulator in recent times had moved the forex market forward by 10 steps, there was a need to take about 90 steps to get the economy to where it ought to be.

Commenting on volume of activities on the I&E FX window, the Acting Director, Corporate Communications, Mr. Isaac Okorafor, said the CBN would sustains its intervention to support the naira.

He said the central bank was comfortable with the external reserves level of $30.3bn. Analysts estimate the bank has spent more than $5bn defending the naira this year.

“Average trading on investors’ window is now $2.2bn in the first six weeks of its introduction with our participation restricted to less than 30 per cent,” Okorafor told Reuters.

“This showed the level of confidence in the system,” he added.

Before the investors’ window was introduced in April, the central bank was the main supplier of hard currency on the interbank forex market, after foreign investors fled naira assets in the wake of an oil price slump in 2014.

The regulator has allowed investors to trade the naira at rates set freely between buyers and sellers, hoping to increase the amount of dollars available in Nigeria – but effectively introducing yet another exchange rate to the five already in operation.

The CBN has an exchange rate for Muslim pilgrims going to Saudi Arabia, a retail rate set by licensed Bureau De Change operators, and a rate for foreign travel and school fees, in addition to the official and black market rates.

The stock market has reacted positively to the introduction of the investor window, rising 34 per cent in six weeks with volumes more than doubling.

The rally also partly follows MSCI’s recent move to boost Nigeria’s weighting on its frontier index, according to analysts.

“When we started intervening in the market, the question was sustainability but we will ensure the process is sustained,” Okorafor said in Lagos.

The central bank last year removed a temporary peg to float the naira, but to protect its precariously low foreign reserves it introduced the convoluted exchange rate system that sees different buyers paying various rates for dollars.

It has said the move is needed to eliminate frivolous demand for foreign currency.

The naira was quoted at 372.70 on the investors’ window on Thursday. It traded at 365 on the black market and was stuck at around 305.25 to the dollar on the official window.

“Today we are gradually achieving convergence between the investor window and invisible window (FX rate for retail users),” Okorafor said

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market.

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Finance

Remove Face Mask When Using ATM, Banks Tell Customers

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Face Mask May Cause ATM Transaction Failure, Banks Tell Customers

Deposit Money Banks have said due to their face recognition technology, customers wearing face masks may experience service failure while using the Automated Teller Machines (ATMs).

In an email issued to customers by Fidelity Bank, the bank said why the use of face masks is important to curb the spread of COVID-19 pandemic, customers should remove when performing ATM transactions.

The bank said “Wearing of face masks is a safety and precautionary measure we must all adhere to in this period of the COVID-19 pandemic.

“However, we advise that you remove your face mask while making withdrawals or carrying out ATM transactions to allow our ATM properly recognise you.

“Fidelity Bank ATM machines have face detection features installed to curb incidences of fraudulent ATM withdrawals.

“Consequently, you may not be able to carry out any transaction if our ATMs are not able to properly recognise you. We apologise for the inconvenience that this may cause you.”

Meanwhile, Guaranty Trust Bank plc continues to ease accessibility for all customers and advised customers to protect themselves.

GTBank said, “When visiting any of our branches, kindly protect yourself by wearing a face mask at all times. It is also very important that you keep a safe distance when in a queue inside or outside the branch.

“Before visiting any of our branches, please remember that you can withdraw up to N150,000 at all our ATMs and that you can do most of your banking from the safety of your home.”

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Access Bank in Talks to Acquire Cavmont Bank

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Access Bank to Acquire Cavmont Bank in Zambia

Access Bank Plc on Wednesday announced that its wholly-owned subsidiary in Zambia, Access Bank Zambia Limited (Access Bank Zambia) is in talks to acquire Cavmont Bank Limited, a subsidiary of Cavmont Capital.

According to the statement signed by Mr. Sunday Ekwochi, Company Secretary, Access Bank and released on the Nigerian Stock Exchange website on Wednesday, the ongoing discussions is to acquire 100 percent of Cavmont Capital’s interest in Cavmont Bank.

However, the lender said “there can be no certainty that a transaction will be agreed, nor as to the terms of any such agreement.

“The completion of a transaction would be subject to formal regulatory approvals. Access Bank will be updating the market as appropriate and in accordance with its disclosure obligations.”

The lender, therefore, advised shareholders to exercise caution when dealing in Access Bank’s securities.

Investors King Ltd note: This announcement further threw more lights on the recent purchases of Access Bank’s shares by Herbert Wigwe, the Chief Executive Officer and Managing Director, Access Bank.

The CEO/MD purchased 7.532 million of Access Bank‘s shares in the last one month.

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Mohammed Umar is the New Acting Chairman of EFCC

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Buhari Appoints Mohammed Umar as EFCC Acting Chairman

President Muhammadu Buhari has appointed, Mohammed Umar, the director of operations at the Economic and Financial Crimes Commission (EFCC), as the new Acting Chairman of the agency, according to the NAN.

A top official of the commission confirmed to NAN that Umar has taken charge of the agency following the suspension of Ibrahim Magu, the former acting Chairman.

Ibrahim Magu was suspended by the President on Tuesday following series of allegations bordering on frauds, financial misappropriations and abuse of power.

 

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