Omodele Adigun
The Central Bank of Nigeria (CBN), expended close to $1.5billion to defend the Naira at the foreign exchange (forex) market in May.
Statistics from the apex bank showed that it intervened six times during the month to pump a total of $1.48billion to stabilise the market.
Analysis shows that on May 2,8,15 and 30, CBN intervened at the inter-bank forex market with $210 million apiece, while on May 4 and 18, it raised its intervention to $349.34 million and $293 million respectively in the Retail Secondary Market Intervention Sales (SMIS) segment of the market. The latter intervention were meant to meet obligations in the agricultural, airlines, petroleum products and raw materials and machinery sectors, unlike the former ,which was for the authorized dealers in the wholesale segment , the Small and Medium Scale Enterprises (SMEs) segment and for invisibles such as tuition fees, medical payments and Basic Travel Allowance (BTA).
Out of the cumulative $840 million pumped into the inter-bank forex market ,the wholesale segment got $400 million, while SMEs and invisibles were allocated $220million each.
Last Sunday, May 27, the apex bank ordered banks not to deny genuine travelers of Personal Travel Allowance (PTA) and Business Travel Allowance (BTA) as there are enough dollar supplies to meet the demand.
In a circular to all commercial banks in the country, its acting Director, Corporate Communications Department, Mr. Isaac Okorafor, assured all the travelers that they would be attended to immediately at the banks’ counters, warning the banks that any contravention would attract penalties from the CBN.
His words: “In order to ensure that eligible travelers are able to access foreign exchange and make liquidity available in the market, the Central Bank of Nigeria (CBN) wishes to make the following release:
“All Deposit Money Banks (DMBs) are mandated to buy and sell foreign exchange to travelers (both customers and non-customers) upon presentation of relevant,valid travel
documents such as visa and ticket OVER THE COUNTER. All travelers shall be attended to immediately at the banks’ counters. Any contravention shall be sanctioned by the CBN.
“All BDCs shall henceforth access forex from the CBN on Mondays, Wednesdays and Fridays. It is compulsory that all BDCs access forex at least three times weekly. Any BDC that fails to access the forex window at least three times weekly shall have its licence reviewed by the CBN.”
This was followed by the Governor, Mr. Godwin Emefiele, leading Bank Examiners to conduct on-the-spot assessment of forex sales at the banks the following day.