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Nigeria's apex bank suspends 14 banks' forex sales

Xinhua, May 3, 2017 Adjust font size:

Nigeria's apex bank has barred 14 Money Deposit Banks from dealing in the Small and Medium Enterprises (SME) wholesale Forex window, an official with the bank said Wednesday.

The banks were barred on Tuesday, following persistent complaints that some Deposit Money Banks (DMBs) deliberately frustrate efforts by many SMEs to access forex from the new window created by Central Bank of Nigeria (CBN), Isaac Okorafor, spokesperson for the apex bank said in a statement made available to Xinhua in Lagos, Nigeria's economic hub.

He said the financial regulator took the decision to bar the erring banks based on field reports, which revealed that only eight banks out of 22 had sold forex to the SMEs segment since the inception of the new window.

He said the CBN frowned at the action of banks that declined to sell foreign exchange to SMEs to enable them to import eligible finished and semi-finished items despite the availability of forex from the CBN.

Okorafor, said all banks that had refused to sell forex to the SMEs after accessing over 300 million U.S. dollars offered through the SMEs window since its creation last month will be sanctioned accordingly.

The barred banks are First Bank, Keystone Bank, Main street Bank, Ecobank, Stanbic IBTC, Citi Bank, Enterprise Bank and WEMA bank.

Others are Guaranty Trust Bank, First City Monument bank, Union Bank, SunTrust Bank, Standard Chartered Bank and United Bank of Africa.

He listed the banks not barred to include: Access Bank Plc, Diamond Bank Plc, Fidelity Bank, Heritage Bank, Jaiz Bank, Sterling Bank, Unity Bank and Zenith Bank.

He warned that the CBN would not sit back and allow any form of instability in the inter-bank forex market through the actions of institutions or individuals.

Meanwhile, the apex bank continued its massive intervention in the foreign exchange segment of the financial market by injecting 196.2 million dollars into the various segments of the Forex market on Tuesday.

According to Okorafor, the apex Bank also offered 100 million to authorized dealers at Tuesday's Forex wholesale auction.

A breakdown of the other interventions indicate that the CBN made available 52 million dollars to the SME segment, while invisible such as Personal and Basic Travel Allowance, medicals and tuition fees received 44.2 million dollars.

The spokesman expressed confidence that the interventions would continue to guarantee stability in the market and ensure availability to individuals and business concerns.

The CBN in April, opened a special foreign exchange window to cater to the SME sector.

The window would enable SMEs to import eligible finished and semi-finished items not exceeding 20,000 dollars for an enterprise per quarter. Endit