Forex infractions: CBN reads riot act to banks

The Central Bank of Nigeria (CBN) yesterday said it will sanction any Deposit Money Bank (DMB) in breach of its earlier directive of March 3, 2017 instructing them to, among other things, open teller points for retail forex transactions and to have electronic display boards in all their branches, showing rates of all trading currencies.

The CBN in a circular warned that it will mete out stiff regulatory sanctions to banks that fail to comply fully with the directive by October 13, 2017.

The circular signed by the Director, Banking Supervision, Ahmad Abdullahi, stressed that the Bank would bar erring DMBs from CBN foreign interventions.

It will be recalled that the CBN in March 2017 had directed banks and authorized dealers to open a teller point for retail FX transactions (PTA/BTA and SME) including buying and selling, in all locations in order to ensure access to foreign exchange by their customers and other users, without any hindrance.

The March 2017 circular also directed DMBs to have electronic display boards in all their branches, showing rates of all trading currencies, which it urged customers to insist on in processing their foreign exchange transactions for invisibles and the SMEs window.

While noting that the all future exchange objective was aimed at creating awareness among members of the public regarding the availability of such facilities in branches of the banks at clearly disclosed prices, the CBN frowned at the banks for not fully complying with its directives.

Meanwhile the CBN continued its intervention in the various sectors of the inter-bank Foreign Exchange market with the injection of $545 million.

Giving a breakdown of the Bank’s latest forex injection, its Acting Director, Corporate Communications, Isaac Okorafor, revealed that the retail Secondary Market Intervention Sales (SMIS) received the largest intervention of $285 million.