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Thursday, March 23, 2023

Banks See Dollar Drop to N423, Express Readiness for Forex Operations

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The Body of Bank Chief Executive Officers (CEOs) has projected that Naira exchange rate to the dollar is expected to recover to at least N423, courtesy of the Central Bank of Nigeria’s (CBN’s) recent directive to stop forex sales to Bureau De Change (BDCs)

The Chairman, the Body of Bank CEOs, Herbert Wigwe, at an online press conference, stated that the banking industry is ready to begin the sale of foreign exchange to customers, maintaining that banks have broader sources than BDCs to meet customers’ forex needs.

In his words: “The move by the CBN is commendable as it would give customers different channels to collect their Personal Travel Allowances (PTAs), Business Travel Allowances (BTAs) and school fees requirements for their children.

“This is just to get you up-to-date on the readiness of the banking industry, so that you will be able to help us communicate to the market that we are ready to carry on with this responsibility.”

According to him, the CBN has sent a circular to all banks to create a designated point to meet customers’ need for forex, while assuring that the service would also come at no additional cost.

“They might have not reached 100 per cent across the country, but it is happening as we speak and there is more than enough forex to meet their demands. There is not one additional charge for all of these things.

“So, compliance is extremely important and it is going to be centralized and the process would be attached to customers’ BVNs so each time there is an offender, he would be reported and likely to face prosecution,” he stated.

Wigwe warned that customers with bad intentions would be reported to regulatory agencies, stating that banks are ready to ensure full compliance with CBN’s directive.

“The banking industry is fully ready and able to carry out this function and as you know that banks have very strict compliance measures in terms of Know Your Customers (KYC) and in terms of verification in making sure that those who apply are eligible. We are going to provide these services and ensure that our branches across the country meet these requirements,” he assured.

He further stated that banks are doing everything necessary to avoid abuse of foreign exchange, saying that the process would be centralized for better service delivery.

Also speaking, the Managing Director, Guaranty Trust Bank, Segun Agbaje, said customers can start working into banks to get served, boasting of banks’ readiness to meet customers’ expectations.

“Different banks are going to have different processes because you will have to look at your controls, you will have to look at what works for you. There is a lot of abuse around foreign exchange, so we might find that to better control this you might want to decentralize or centralize or a combination of the two,” he said.

He noted: “The rates we saw yesterday and today are a complete aberration and if I recall correctly, BDC money comes at N412 and the banks would sell it at N412. With this development, customers have a wider network to buy from and I can bet the rates are going to come down and it would be very easy to buy at N423 or N425 if you are travelling today.”

In her words, the Managing Director and Chief Executive Officer, Unity Bank Plc, Tomi Somefun, allayed the fears of customers, stressing that banks are gearing up to meet customers’ needs.

“In terms of the challenges we expect, it will be one of documentation and integrity on the kind of documents that are presented. We have discussed this at our meeting and we are putting all hands on deck to ensure that these challenges do not impede the initiative,” she said.

The Managing Director, First City Monument Bank (FCMB), Yemisi Edun, said with proper documentation, customers would be directed to the designated teller desk that will attend to their needs, saying that banks are putting infrastructure and processes in place to make the initiative a success.

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