CBN Raises Weekly Dollar Sale To $50,000 For BDCs - EazyFeeds

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Wednesday 17 August 2016

CBN Raises Weekly Dollar Sale To $50,000 For BDCs

The Central Bank of Nigeria (CBN) yesterday raised the weekly limit of forex banks can sell to Bureaux De Change (BDCs) from $30,000 to $50,000.

The managing director of United Bank for Africa, Mr Kennedy Uzoka, told journalists at the end of the Bankers’ Committee meeting in Abuja, yesterday, that the decision to increase the amount was taken to drive down the price of the dollar and ensure that people get enough to pay school fees as schools are about to reopen, and also because people who will be traveling at this period will require Basic Travel Allowance (BTA) and PTA.

Members of the bankers’ committee urged BDCs to henceforth approach banks and apply for Forex allocations.

Also speaking on the development, spokesman for the apex bank, Mr Isaac Okoroafor, said the apex bank “will now have to monitor strictly that people do not abuse the process.”

Managing director of Zenith Bank, Peter Amangbo, in his address, told journalists that in keeping with the coming celebration of World Savings Day, all banks in Nigeria will break into different groups to cover all the local government areas in the country to sensitise those at the grassroots on the need for people to save massively.

Amangbo stated that the sensitisation of the grassroots by all banks “is to grow the pool of funds available for lending and the need to save.”

The Zenith Bank boss noted that “there will always be disparity in savings and interest rate” and stressed that “the gap is not as wide as people think it is and the longer people save the more interest they will earn.”

On the recent directive by the CBN to all banks to open savings accounts with zero amount, Amangbo clarified that the decision was not new, saying it had been in effect for about two years now.

According to him, “there are lots of accounts that can be opened with minimal documentation.”

On the need to have bank branches in every nook and cranny of the country, Amangbo said: “You don’t need brick and mortar branches anymore because mobile apps are now game changers. As a result there is no need to have beaches in local government areas.”

On her part, the CBN’s director of Banking Supervision, Mrs Tokunbo Martins, disclosed that a decision was taken at the end of the bankers’ committee meeting to start disbursing the special intervention fund to support primary agricultural projects and core manufacturing.

According to Martins, “the CBN took from the bank’s cash reserves called the special intervention fund. That fund has been with the CBN for some time.”

This special intervention fund, she said, will be “for projects that support import substitution, projects that will help protect foreign exchange such that whatever we were importing before can be manufactured.”

This fund she added “will be released to these kinds of projects; it will not be released to just any kind of project. And once these funds are released, there will be some ease on the system and there will be more liquidity, so important projects will get financing at a lower single digit interest rate.”

She also clarified that the decision to have banks write off their Non-Performing Loans (NPLs) was not an arbitrary one.

He clarified that “only NPLs that have been fully provided for in the books for the banks are those that can be written off and not an arbitrary right off of NPLs.”

On the issue of increasing the amount that BDCs can purchase from banks, the bankers’ committee noted that the decision was not a reversal of the earlier decision but a tweaking of the earlier decision because the country is battling a dollar crisis.

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