CBN Has My Backing On Redesigning Of Naira Notes  – Buhari 

A photo combination of President Buhari and CBN Governor, Godwin Emefiele.

 

President Muhammadu Buhari says he is fully in support of the Central Bank of Nigeria (CBN)’s move to redesign the naira notes. 

The CBN had last week said it will redesign the N1,000, N500 and N200 notes, effective December 1, a development that has elicited mixed reactions.

But in a statement by his media aide Garba Shehu, the President said he is “convinced that the nation will gain a lot by doing so”.

READ ALSO: CBN Didn’t Consult Finance Ministry On Redesign Of Naira Notes – Zainab Ahmed

“Speaking in a Hausa radio interview with the famous journalist Halilu Ahmed Getso, and Kamaluddeen Sani Shawai to be aired Wednesday Morning on Tambari TV on Nilesat, President Buhari said reasons given to him by the CBN convinced him that the economy stood to benefit from the reduction in inflation, currency counterfeiting and the excess cash in circulation,” Mr Shehu said on Sunday.

“He said he did not consider the period of three months for the change to the new notes as being short.

”People with illicit money buried under the soil will have a challenge with this but workers, businesses with legitimate incomes will face no difficulties at all.”

CBN Didn’t Consult Finance Ministry On Redesign Of Naira Notes – Zainab Ahmed

 

The Minister of Finance, Zainab Ahmed, on Friday said the Central Bank of Nigeria did not consult her ministry before taking the decision to redesign naira notes by December.

She made the disclosure during the budget debate of the Ministry of Finance, Budget and National Planning in Abuja.

The Minister said even though one of the reasons for the decision is to manage inflation, consequences are sure to follow.

“We were not consulted,” she said. “It was an announcement that we heard. Part of the reasons that was advocated is that it is one of the ways to mop up the liquidity to manage inflation.

“But there are also consequences – we are looking at what the consequences will be. There will be some benefits but there will be some challenges.

“And I don’t know whether the monetary authorities have actually looked very closely at what the consequences and how they will mitigate it.”

Why I Fully Support CBN’s Redesign Of Naira – Moghalu

Kingsley Moghalu.

 

A former Deputy Governor of the Central Bank of Nigeria (CBN), Kingsley Moghalu, on Friday explained why he is in support of the bank’s recent decision to redesign naira notes.

In a series of tweets, Mr Moghalu said the CBN is trying to gain control over money supply in the economy.

He noted that while the move may not stem inflation, it is “necessary step.”

“I fully support the Central Bank’s redesign of the Naira,” he said. “If 80% of bank notes in circulation are outside the banks, that’s troubling. The CBN obviously wants to force all those notes back into the banking system. Those with the notes must surrender to get new ones or else it becomes illegal tender after January 31 2023.

“This is also a way to withdraw currency from circulation, an unorthodox way of tightening the money supply since the country is battling high inflation.

“The flip side is that people who are holding huge amounts of cash outside the banking system for nefarious reasons will go the parallel forex market to buy hard currency, putting further downward pressure on the value of the Naira as too much Naira will be chasing too few dollars.

“I doubt it will solve inflation because there also are other major reasons for inflation such as the forex crisis, which this new move could exacerbate, as well the impact of the security crisis on food price inflation.

“But overall it is a necessary step.

“I just think the time window for its implementation is rather short. This will put a lot of operational pressure on commercial banks and the financial system in general. A 90 day window would have been better, but one can understand the need to avoid interfering with the elections.”

CBN To Redesign N200, N500 And N1,000 Notes

 

 

The Central Bank of Nigeria (CBN) on Wednesday said it will redesign the N200, N500, and N1,000 notes. 

CBN Governor, Godwin Emefiele, disclosed this during a special press briefing in Abuja.  The new design and issues will be effective from December 15, 2022.

The action was taken in order to take control of the currency in circulation, according to the CBN boss.

 

 

The apex bank, Emefiele stated, has secured the approval of President Muhammadu Buhari to roll out new notes to replace the existing currency in circulation.

READ ALSO: Buhari Seeks Expanded Trade Relations Beyond Gas Exports To South Korea

“In line with the provisions of Sections 2(b), Section 18(a) and Section 19, Sub section(a) and (b) (2007), the management of the CBN has sought and obtained the approval of President Muhammadu Buhari to redesign, produce, release and circulate new series of banknotes at N200, N500 and N1,00 levels,” he said.

“In line with this approval, we have finalised arrangements for the new currency to begin circulation from December 15, 2022 after its launch by President Buhari.

“The new and existing currencies shall remain legal tender and circulate together until January 31, 2023 when the existing currencies shall cease to be a legal tender.”

Once the new notes are designed Nigerians are expected to take old notes to banks for the new notes.

The CBN Governor is also concerned about how Nigerian currency is being stored currently.

According to him, the bulk of the nation’s currency notes was outside bank vaults and the CBN would not allow the situation to continue.

Emefiele added, “To be more specific, as of the end of September 2022, available data at the CBN indicates that N2.7 trillion out of the N3.3 trillion currency in circulation was outside the vault of commercial banks across the country and supposedly held by members of the public.

“Evidently, currency in circulation has more than doubled since 2015, rising from N1.46 trillion in December 2015 to N3.2 trillion as of September 2022. I must say that this is a worrisome trend that must not be continued to be allowed.”

According to him, the initiative by the CBN will help address some of the nation’s security threats, especially kidnapping and terrorism.

He believes that terrorists and kidnappers capitalise on the large excess of money to carry out their nefarious activities.

 

Strategic Capital Investment Acquires Polaris Bank

 

The Central Bank of Nigeria (CBN) has completed the sales of Polaris Bank to a new core investor Strategic Capital Investment Limited (SCIL).

This is according to a statement by the CBN Director of Corporate Communications Osita Nwanisobi who said the investment company got 100 percent equity stakes in Polaris Bank.

The Thursday statement said that SCIL paid N50 billion upfront to acquire the equity. The bank has been operating as a bridge bank since 2018 when the apex bank intervened to revoke the licence of the former Skye Bank Plc and established a bridge bank to assume its assets and certain liabilities.

READ ALSO: [Electricity] Buhari Restates Commitment To Partnership With Germany, Siemens

“This sale marks the completion of a landmark intervention in a strategic institution in the Nigerian banking sector by the CBN and AMCON. We commend the outgoing board and management for their vital role since the bridge bank was established; in stabilising the Bank’s operations, its balance sheet and implementing strong governance structures to address the issues that led to the intervention,” he quoted Godwin Emefiele CBN governor as saying on Thursday.

“This process has provided the CBN with an unprecedented opportunity to recover its intervention funds in full and promote financial stability and inclusive growth. We wish SCIL well as they implement growth plans to build the bank from the strong foundations that have been established.”

Trapped Funds: CBN Releases $265m To Airlines

A file photo of CBN Governor, Mr Godwin Emefiele.

 

The Central Bank of Nigeria (CBN) has released the sum of $265 million to airlines operating in the country to settle outstanding ticket sales in an apparent move to check a brewing crisis in the country’s aviation sector.

A breakdown of the figure released on Friday indicates that the sum of $230 million was given as special Forex intervention while another sum of $35 million was released through the Retail SMIS auction.

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Confirming the release, the Director, Corporate Communications Department at the CBN, Mr. Osita Nwanisobi, said the CBN Governor, Godwin Emefiele, and his team were concerned about the development and what it portends for the sector and travelers as well as the country in the comity of nations.

Nwanisobi reiterated that the Bank was not against any company repatriating its funds from the country, adding that what the Bank stood for was an orderly exit for those that might be interested in doing so.

With Friday’s release, it is expected that operators and travellers as well will heave huge sighs of relief, as some airlines had threatened to withdraw their services in the face of unremitted funds for the outstanding sale of tickets.

We Are Working To Avert Naira’s Further Fall Against Dollar, CBN Assures Nigerians

File photo

 

The Central Bank of Nigeria (CBN) has advised Nigerians to resist the urge of succumbing to the speculative activities of some players in the foreign exchange market.

It gave the advice in the face of rising demand for foreign exchange for both goods and services by Nigerians.

CBN’s Director of Corporate Communications, Osita Nwanisobi, who briefed reporters on Thursday in Abuja said the apex bank remained committed to resolving the foreign exchange issues confronting the nation and as such has been working to manage both the demand and supply side challenges.

While admitting that there was huge demand pressure for foreign exchange to meet the needs of manufacturers and for the payment of tuition, medical fees and other Invisibles, Nwanisobi said the bank was concerned about the international value of the naira.

He added that the monetary authority was strategising to help Nigeria earn more stable and sustainable inflows of foreign exchange in the face of dwindling inflows from the oil sector.

Specifically, Nwanisobi said the recent initiatives undertaken by the bank such as the RT200 FX Programme and the Naira4Dollar rebate scheme have helped to increase foreign exchange inflow to the country.

According to him, the bank’s records showed that foreign exchange inflow through the RT200 FX Programme in the first and second quarters of 2022 increased significantly to about $600 million as of June 2022.

The CBN spokesman disclosed that the Naira4Dollar incentive also increased the volume of diaspora remittances during the first half of the year.

He said interventions such as the 100 for 100 Policy on Production and Productivity, Anchor Borrowers’ Programme (ABP) and the Non-Oil Export Stimulation Facility (NESF), among others, were also geared toward diversifying the economy, enhancing the inflow of foreign exchange, stimulating production and reducing foreign exchange demand pressure.

Nwanisobi gave an assurance that the bank would continue to make a deliberate effort in the foreign exchange sector to avert a further downward slide in the value of the naira which he observed was fuelled by speculative tendencies.

Reiterating an earlier position of the CBN Governor, Mr Godwin Emefiele, he urged Nigerians to play their role by adjusting their consumption patterns, looking inwards and finding innovative solutions to the country’s challenges.

The CBN spokesman submitted that monetary policy alone could not bear all the burden of the expected adjustments needed to manage the challenges around Nigeria’s foreign exchange.

“It’s our collective duty as Nigerians to shore up the value of the naira,” he said.

Senate Summons Emefiele As Naira Continues To Depreciate Against Dollar

A file photo of Governor of the Central Bank of Nigeria, Godwin Emefiele

 

The Senate has resolved to summon the Governor of the Central Bank of Nigeria, Mr Godwin Emefiele, to explain the reasons for the rapid depreciation of the value of the naira.

It has also mandated its Committee on Banking, Insurance and Other Financial Institutions to assess the impact of CBN intervention funds meant to support critical sectors of the economy.

The Upper chamber is taking these resolutions after federal legislators considered a motion on the state of CBN Intervention funds and the free fall of the naira.

The sponsor of the motion Senator Olubunmi Adetunmbi bemoaned Nigeria’s economic challenges and calls for extraordinary measures to address them.

As of Thursday morning, the naira was exchanging for more than N700 to a dollar in the parallel markets.

CBN Raises Interest Rate To 14% To Check Inflation

 

The Central Bank of Nigeria (CBN) has raised the Monetary Policy Rate (MPR) from 13 percent to 14 percent.

CBN Governor Godwin Emefiele announced this on Tuesday during the 286th meeting of the Monetary Policy Committee held in Lagos.

READ ALSO: UPDATED: CBN Raises Interest Rate For First Time In Over Two Years To 13%

According to him, it was the right option considering economic realities.

CBN Governor, Ifeanyi Emefiele, speaks during the bank’s 286th MPC meeting in Lagos on July 19, 2022.

 

“The committee resolved that the most rational policy option would be to further strengthen its tightening stance in order to effectively curtail the unabated rising trend of inflation,” Emefiele said.

“Members were conscious of the fact that output growth remained fragile. However, not curtailing inflation now could erode the monetary gains achieved in improving consumer purchasing power and thus worsen the poverty level for the vulnerable populace.”

The monetary policy rate (MPR) is the main interest rate in a country or economy on which all other interest rates in that economy are based.

While the apex bank increased the MPR rate, it, however, retained other parameters.

The asymmetric corridor remains +100 and -700 basis points around the MPR, and the well as Cash Reserved Ratio (CRR) at 27 percent.

He added, “Committee thus vote unanimously to raise the Monetary Policy Rate (MPR). One member voted to increase the MPR by 150 basis points, six members by 100 basis points, one member by 75 basis points and three members by 50 basis points.

“Consequently, Committee resolved to increase the MPR by 100 basis points from 13 percent to 14 percent. In summary, MPC voted as follows:

“Increase MPR to 14% from 13, retain the Asymmetric Corridor at +100 and -700 basis points around the MPR, retain the CRR at 27.5 percent and retain liquidity ratio at 30 percent.”

Tuesday’s rate hike marks the second time, the MPC will raise the interest rate in two months.

The MPC increased the rate from 11.5 percent to 13 percent on May 24.

Meanwhile, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, is worried about the implication of the new interest rate for the economy.

Although the MPC expects the step to tame inflation, Dr Yusuf, thinks the opposite may be the case.

“I am concerned about MPR hike because it will burden manufacturers and investors; factors driving inflation in Nigeria different from factors driving inflation in other countries CBN is comparing Nigeria with,” he said during an appearance on Channels Television’s live show on the MPC decision.

Emefiele’s Ambition: CBN Board Is To Determine If Laws Were Broken – Buhari

President Buhari and CBN Governor, Godwin Emefiele.

 

President Muhammadu Buhari says it’s not in his place to determine if the political ambition of Central Bank Governor, Godwin Emefiele, infringes on any laws that affects his productivity. 

Buhari stated this on Tuesday during his interview with Bloomberg.

There have been debates around the central bank’s independence following the governor showing interest in running for presidency, however, Buhari was of the opinion that his is to appoint and the appointment is subject to confirmation by the Nigerian Senate.

According to the president, “Ultimately, it will be for the CBN’s board of directors to determine whether a CBN governor’s actions have fallen foul of the laws in place to ensure he can most effectively carry out his duties”.


READ ALSO: Execute Comprehensive Onslaught Against Bandits In Kanji National Park, Senate Urges Military


President Buhari, however, asserted that there is a subtext to the accusations, stressing that “because the governor follows a model outside of the economic orthodoxy, he is labelled political”.

He further argued that the orthodoxy has proved wrong time and again.

“Instead, the governor is following an alternative economic model that puts people at the heart of policy.

“Nigeria should be free to choose its development model and how to construct our economy, so it functions for Nigerians,” President Buhari buttressed.

Reacting to questions regarding security, the president said that his administration is the only one in Nigeria’s history to implement a solution to decades-long herder/farmer conflicts, exacerbated by desertification and demographic growth.

He explained that the National Livestock Transformation Plan, putting ranching at its core, is the only way to deplete the competition for resources at the core of the clashes.

According to him, governors from some individual states have sought to play politics where ranches have been established; but where they have been disputes have dramatically reduced.

Speaking further as to the war against terror, President Buhari explained that in 2015, Boko Haram held territory the size of Belgium within the borders of Nigeria, adding that today, however, the terrorists are close to extinct as a military force.

Buhari while reaffirming that a leader of ISWAP was eliminated by a Nigerian Airforce airstrike in March, noted that the jets acquired from the US and intelligence shared by the British were not provided to previous administrations and stand as testament to renewed trust re-built between Nigeria and her traditional western allies under his government.

INEC Says Sensitive Election Materials No Longer To Be Kept With CBN

FILE: INEC Chairman, Mahmood Yakubu addresses the media during the demonstration of E-voting machines at the INEC headquarters in Abuja on September 28th, 2020. PHOTO: Sodiq Adelakun/Channels TV
FILE: INEC Chairman, Mahmood Yakubu addresses the media during the demonstration of E-voting machines at the INEC headquarters in Abuja on September 28th, 2020. PHOTO: Sodiq Adelakun/Channels TV

 

The Chairman of the independent National Electoral Commission (INEC), Mahmood Yakubu, says sensitive electoral materials will in the meantime no longer be routed through the Central bank of Nigeria (CBN).

He also specifically notes that, beginning from the Ekiti State Governorship election, INEC will not keep its sensitive materials with the CBN.

According to him, this decision is to guarantee that electoral materials for the lined up Elections are not compromised

READ ALSO: INEC Launches Regulations, Guidelines For General Elections

The INEC Chairman stated this while responding to questions in an ongoing dialogue in Abuja.

Several individuals and groups have raised serious concern about the sanctity of Elections materials kept with the CBN, after stories about the CBN governor, Mr Godwin Emefiele, indicating interest to contest for the country’s presidential seat hit the airwaves in recent months.

Ex-Bankers Give CBN, NDIC Ultimatum To Pay N5.7bn Benefits After Court Victory

Chairman of the Association of Ex-Staff of Non-Consolidated Banks of Nigeria, Magnus Maduka.

 

Discharged bankers under the aegis of the Association of Ex-Staff of Non-Consolidated Banks Of Nigeria have given the Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Corporation (NDIC) an ultimatum to pay their N5.7billion benefits.

The Chairman of the association, Magnus Maduka, issued the ultimatum on behalf of the members on Friday during an interview on Channels Television’s Sunrise Daily, about two weeks after they won in court.

“The judge said he gave them (CBN and NDIC) three months to pay up, failing which the delay will begin to attract 10 per cent interest on the sum,” he said.

A National Industrial Court in Lagos had on May 23 ordered the Federal Government agencies to pay over N5.7bn terminal benefits to more than 1,000 bank workers affected by the re-capitalisation exercise of 2006.

The money, according to Justice Paul Bassi, is to be paid within three months from the date of judgment failing which would attract 10 per cent interest until liquidated.

READ ALSO: Court Orders CBN, NDIC To Pay Bank Workers N5.7bn

About two weeks after the court judgement, the former bankers issued a month’s ultimatum for the CBN and the NDIC for payment of the said benefits to them.

“We gave them one month anyway because we can’t be on this forever,” Maduka added. “If central bank and the NDIC want to save themselves unnecessary problems, they should just grant every staff of those banks, including those that joined last week before the shutdown of the banks their terminal benefits.”

When asked if both agencies had contacted the former bankers on the implementation of the court judgement, Maduka replied in the negative.

He, however, stated that the CBN and the NDIC were aware of the order as they had their lawyers in court on the day the verdict was passed.

According to him, the N5.7 billion benefits would cover the 1,116 former bank workers, as well as those he said, were sending in their letters of credit.