CBN Exposes Key Players Responsible for Naira Crash, Bars Bank CEOs From Leaving Nigeria

CBN Exposes Key Players Responsible for Naira Crash, Bars Bank CEOs From Leaving Nigeria

  • Reports say the Central Bank of Nigeria barred top bank officials and CEOs from leaving Nigeria between August 5 to 15, 2023
  • The bank CEOs and MDs allegedly traded in illicit foreign exchange and caused forex scarcity leading to a surge in the dollar against the naira
  • The report revealed that the bank CEOs allocated huge Forex to families, friends, and cronies

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According to reports, the Central Bank of Nigeria (CBN) barred bank chief executive officers and top officials in Nigeria from leaving the country between August 5 to 15, 2023, so they could answer for foreign exchange infractions.

Reports by The Nation reveal that bank executives sold their foreign exchange at high costs following the decision to unify the exchange rates.

CBN, bank MDS, CEOs
Acting governor of the Central Bank of Nigeria, Folashodun Shonubi Credit: Boy_Anupong
Source: Getty Images

Bank chiefs and MDs ferried Forex abroad

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The newspaper quotes sources as saying that the beneficiaries of the naira crash were bank chief executives who held sway and sold dollars at will.

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They say that before the emergence of Tinubu as President, bank chiefs dispensed Forex among families, friends, and cronies, which contributed to delays in accessing cash and foreign exchange by bank customers.

Per the report, after the CBN allocated FX to the banks, the banks' CEOs and top officials engaged in round-tripping, money laundering, and other unethical practices.

The source said that the apex bank lifted the travel ban on Tuesday, August 15, 2023, against bank MDs and CEOs after the acting Governor of CBN's meeting with President Tinubu.

The travel ban was not punitive but a call to national duty.

Before now, CBN gave weekly Forex allocations to commercial banks to meet legitimate demands, urging fair transactions to purchase FX from banks with minimal documentation.

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Banks violate CBN's Forex rules

The commercial banks had 48 hours to settle their customers' foreign exchange demands, with banks being asked to set up teller points at designed branches across Nigeria to serve Forex requests for PTA and BTA, tuition fees, medical payments, and other transactions.

The banks were also directed to begin accepting cash deposits of Forex from customers and to publicise the locations of the designated branches.

Reports say the banks decided to increase the processing time for Forex access for international school fees paid via Form A from 48 hours to 120 days, a sharp departure from CBN's FX policy.

The travel restrictions reportedly put a wedge in the local currency's fall.

When contacted, CBN spokesman Isa AbdulMumin said he was unaware of the travel restrictions.

"I did not see the letter imposing the travel restrictions," AbdulMumin said.

Meanwhile, the naira has recently witnessed a massive surge against the US dollar at both the official and parallel markets.

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On Monday, August 21, 2023, the naira traded flat at N739 against the official dollar at the Investors and Exporters (I&E) wind and N860 at the parallel market.

The naira's surge comes amid NNPC's $3 billion loan from AfreximBank to fight the foreign exchange crisis in Nigeria and CBN's promise to intervene to stall the activities of speculators.

CBN reveals currency in circulation dropped by N7.51 billion in one month reported that the Central Bank of Nigeria (CBN) has revealed that the money in circulation in Nigeria declined from N2.6 trillion as of the end of June 2023 to N2.37 trillion by the end of July 2023.

The development is the first time the amount has declined since February.

Data from CBN showed that the figure represents a decline of N7.51 trillion in 30 days.


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