Banks shop for buyers as CBN floods market with Forex

The new strategy of the Central Bank of Nigeria to meet all legal demand for foreign exchange has led Money Deposit Banks to contend with expending all the dollars in their possession.

A check in Abuja showed that the banks had cleared all backlog of demands for foreign currencies for basic travel allowance, school fees and medicals.

A source in the United Bank for Africa said that UBA had so much dollars that the bank’s marketers had been asked to encourage customers to request for foreign currencies.

The source said that the bank wanted to avoid a situation where it was forced to return excess Forex to the CBN.

It explained that doing so would force the CBN to reduce the quantity of Forex it sold to banks.

Another source from First Bank said following the CBN intervention, the bank had succeeded in clearing all pending requests for Forex as far back as September 2016.

Also, a source in Guaranty Trust Bank commended the decision of the CBN to flood the market with Forex, thereby allowing the banks to meet legitimate demands from its customers.

It was also gathered from Heritage Bank that prior to now, the bank published the names of individuals and companies it disbursed Forex to in a page of any particular newspaper.

A source said, “Right now, we take two or three pages in the newspaper to publish names of legitimate individuals and companies that we disbursed Forex to.

“We have more than enough foreign exchange to meet the request of our customers for school fees and others.”

In a data released by the CBN, the apex bank, within three weeks, injected more than $1.4bn for both wholesale and retail intervention into the interbank Forex market.

(NAN)