It was a harvest of sanctions at the foreign exchange (forex) market as the Central Bank of Nigeria (CBN) stepped up its foreign exchange demand management barring some Deposit Money Banks (DMBs) bank customers and Bureau De Change (BDC) operators.
Bank customers who spent above the US$50,000 annual foreign exchange limit on their Naira debit cards from were barred from participating in the foreignexchange market.
Similarly, the apex bank barred all Deposit Money Banks but First Bank from selling foreign currency remittances received from International Money Transfer Operators (IMTO) to licensed Bureau De Change operators following failure by the banks to comply with CBN rules on such sales.
The Central Bank action was sequel to complaints by BDC operators that the affected banks were involved in buying at low rates and selling at very high rates (arbitraging) activities.
The affected banks were there after directed to sell their dollar inflows from remittances to Travelex, an IMTO, for onward sale to the BDCs.
On the same note, 195 BDC operators were suspended by the apex bank for failing to render returns and renew their operating licences.
Similarly, Nigeria’s foreign exchange in the just concluded week declined week-on-week by 0.73per cent to US$24.21 billion as at Wednesday 12 October amid moderation inglobalcrudeoilprices.
Dealers at an investment research and securities group, Afrinvest believes that in the interim, the spot rates at the interbank will trade within a tight band whilst the Apex Bank continues to intervene. However, reports that the CBN has suspended a number of banks from selling dollars to Bureau De Change operators may pressure rates at the unregulated segment of the FX market, it stated.