CBN To Task Banks On 24hr FX Sale

CBN To Task Banks On 24hr FX SaleNigeria’s Central Bank says it will direct commercial banks to sell business and personal travel allowances to retail customers within 24 hours of filing a demand request.

This follows complaints that some banks are delaying the sale of fx to retail customers in contrast to the new forex policy issued by the CBN recently.

The apex bank also says that banks would be compelled to open forex transaction compartments in all branches across the country, to enhance the ease of forex transactions to Nigerians.

A source also told Channels Television that all commercial banks will be asked to have electronic fx rate display system in all their branches.

This is expected to promote transparency and disclosure of rate to retail customers of the banks.

J.P. Morgan To Delist Nigeria Bonds

JP-MorganJ.P. Morgan has concluded plans to remove Nigeria from its government bond index by the end of October 2015.

The statement is coming after an earlier removal notice on the absence of currency controls, leading to complicated transactions on the bond.

According to J.P. Morgan, some bonds would be delisted by the end of September, while the rest would be removed by the end of October.

Liquid Currency Criteria

The index provider said Nigeria would not be eligible for re-inclusion in the index for a minimum of 12 months. It added that to get back in the reading, Nigeria would have to satisfy the consistent liquid currency criteria.

Meanwhile, the Central Bank of Nigeria, in reaction to the notice, said “it disagrees with the index expulsion”.

The apex bank also said it had started to improve liquidity and transparency in the market, just as foreign exchange traders confirmed that U.S. Dollars rationing to foreign investors has begun.

Nigeria became the second African country after South Africa to be listed in J.P. Morgan’s emerging government bond index, in 2012. Its inclusion adds a 1.8 per cent weight to the index.

The removal will trigger unprecedented sales of Nigerian bonds, resulting in capital outflows and raising borrowing costs for the government.