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By Dipo Olowookere

The Central Bank of Nigeria (CBN) has threatened to suspend the foreign exchange (FX) license of any bank involved in forex embezzlement.

The central bank issued this threat in a circular dated Friday, September 10, 2021 and signed by its director of the Department of Trade and Foreign Exchange, Dr OS Nnaji.

The notice said that the foreign exchange license of banks discovered for participating in the foreign exchange fraud would be suspended for at least a year, advising depository banks (DMBs) to strictly adhere to the rules and regulations governing currency sales.

The shortage of foreign exchange in the system has forced the umbrella bank to tighten its policies regarding foreign currency transactions in the country.

In late July, the bank, after its two-day Monetary Policy Committee (MPC) meeting in Abuja, announced the stopping the sale of foreign currency to exchange office operators (BDC) on what he described as FX manipulations.

He also announced the suspension of the registration of new BDCs and these actions put the Naira under undue pressure on the black market.

The exchange rate of the Nigerian currency against the greenback was N545 / $ 1 Friday at the close of business and the central bank is not satisfied with the situation, which is why it is taking action to fix the problem.

Because of its power to sanction banks as the national banking sector regulator, the CBN, which hijacked weekly sales of foreign exchange to BDC financial institutions, pledged to deal with lenders sabotaging the bank. economy in its ongoing investigations.

“We wish to reiterate that the foreign exchange operating license of any bank or banks found guilty of pending investigations could be suspended for at least a year,” part of the disclosure said.

The central bank revealed that it was conducting “surveillance of our financial markets in general and the foreign exchange market in particular”, reminding “banks to refrain from all forms of currency embezzlement”.

He stressed that it was “their responsibility not only to know their customers (KYC requirements), but also to know their customers’ activities (KYCB requirements)”.

Apex Bank said it is issuing the warning “in view of recent developments in the market” and to remind them of their “responsibilities” as authorized forex traders.

When on July 27, 2021, the CBN banned foreign exchange sales to BDCs, it ordered commercial banks to set up a bureau de change in their branches with the aim of honoring genuine requests from retail clients with the proper documentation.


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