CBN readmits more banks to special window forex market

Following the provision of evidence of sales of foreign exchange (FOREX) to Small and Medium scale Enterprises (SME) since the introduction of the special window for small businesses, the  Central Bank of Nigeria (CBN), on Thursday  readmitted Keystone Bank  into the spot and wholesale forwards segment of the foreign exchange market .

This was after Guaranty Trust Bank (GTBank) Plc, FirstBank and United Bank for Africa (UBA) Plc were on Wednesday readmitted into the market by the apex bank after the three lenders were able to provide the banking system regulator with evidence that they had been selling FOREX to SMEs since the introduction of the special window.

The CBN had banned fourteen banks from participating in the weekly wholesale spot and forwards intervention market leaving only eight banks.

According to the CBN, the banks were sanctioned for not adhering to the FX supply policy to SMEs thereby frustrating the efforts of small businesses that needed FOREX. The eight banks that were not suspended include; Access Bank Plc, Diamond Bank Plc, Fidelity Bank Plc, Heritage Bank Plc, Jaiz Bank, Sterling Bank Plc, Unity Bank Plc and Zenith Bank Plc.

Speaking on the development, the Acting Managing Director of Keystone Bank, Mr. Hafiz Bakare 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”.

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

The FOREX supply policy to SMEs was introduced as a means to provide small scale businesses with a lifeline as findings showed that they were being crowded out by larger scale firms in the FX market. Under this special arrangement, companies with staff strength of between 10 to 199 and an asset base of N5m to N500m were offered the opportunity.

CBN spokesman, Mr. Isaac Okoroafor said there was no cause for alarm as the development showed there was enough to meet the legitimate needs of genuine customers.

He further disclosed that the CBN was in receipt of requests submitted by authorized dealers on behalf of their customers for interventions in the retail segment of the market.

He added that the CBN would continue its intervention of $20,000 to dealers in the Bureau de Change (BDC) segment this week.

While stressing that the CBN was nearing its goal of a rate convergence in the interbank and the BDC segments of the market, Okorafor re-echoed the assurances of the CBN governor, Godwin Emefiele to sustain the current levels of interventions in all segments of the market.