Forex Market: CBN Okays Four More Banks  


BY CHINYERE OBIORA, LAGOS – The Central Bank of Nigeria (CBN) on Thursday readmitted four commercial banks into the spot and wholesale forwards segment of the foreign exchange market.

Listed among the quartet pardoned by the apex bank are Keystone Bank, First Bank of Nigeria (FBN) Limited, United Bank for Africa (UBA) and Guarantee Trust Bank (GTB). 

CBN had on Monday, May 1, 2017 banned 14 banks from the weekly wholesale spot and forwards intervention market with only eight banks escaping the axe. CBN had explained that the erring banks were banned following their non-adherence to the new Forex supply policy meant to address bottlenecks frustrating efforts of small businesses to meet their Forex needs.

However, the current reverse action followed the provision of evidence by the four banks indicating their profile of forex sales to Small and Medium scale Enterprises (SME) since the introduction of the special window for small businesses.

According to a Forefront source, “The CBN cleared the four banks for the weekly wholesale spot and forwards intervention, following proven claims that they were in compliance with the Forex sales to small businesses through the SME FX window.”

An elated acting Managing Director of Keystone Bank, Mr. Hafiz Bakare , who reacted to the development in Lagos on Thursday, said, “SMEs are an integral part of the economy of Nigeria and as such we at Keystone Bank are committed to supporting this sector.”

“We are pleased to have clarified the banks position with the CBN as we have always shown support for SMEs through our work with farmers, manufacturers, schools and other business owners”, Bakare said

He further stated that Keystone Bank will always support the CBN in ensuring sustainable growth and development of the economy.

A market insider hinted that the sale of Forex to SMEs is now the “gold standard” for banks to participate in the FOREX market and CBN will readily sanction any bank or officials that circumvent the existing rules.

CBN introduced the SMEs’ FOREX supply policy as a means of providing small businesses with a lifeline to grow their trade following findings that they were being crowded out by big players in the FX market. Under this special arrangement, companies with a staff strength of 10 to 199 and an asset base between N5m and N500m, were offered the special opportunity.

The eight banks that initially escaped the CBN’s axe are: Access Bank Plc, Diamond Bank Plc, and Fidelity Bank Plc. Others include Heritage Bank Plc, Jaiz Bank, Sterling Bank Plc, Unity Bank Plc and Zenith Bank Plc.

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