BY Ezinne Chima
The Central Bank of Nigeria (CBN) on Friday increased the weekly supply of dollars to Bureau De Change (BDC) operators from $15,000 per BDC to $30,000.
The policy takes effect from the Wednesday, January 28, 2015 auction.
The CBN revealed this in a circular titled: “Review of Weekly Foreign Exchange Cash Sales to Bureau De Change Operators,” signed by Olakanmi Gbadamosi, who is it Director, Trade and Exchange Department, obtained on its website.
According to the central bank, the policy was meant to deepen the BDCs segment and also improve market liquidity.
Furthermore, the CBN stated that it would sell the greenback to BDCs weekly at the prevailing interbank rate, but warned the dealers not to sell to the public at more that 3.5 per cent of its selling rate.
The circular reads: “This is to inform Bureau De Change (BDC) operators and the general public that as part of the ongoing review of developments in the foreign exchange market and in order to deepen the BDCs segment, the weekly forex cash sales to BDCs have been reviewed upward from $15,000 to $30,000 per BDC, with effect from Wednesday, January 28th, 2015 auction.
“While the CBN will sell to BDCs weekly at the prevailing interbank rate, the BDCs are expected to sell to the public at not more that 3.5 per cent above the CBN selling rate. Consequently, all BDCs are to ensure that the designated accounts in the CBN are duly funded with the equivalent naira proceeds not later than 48 hours before the bidding date.
“Operators are hereby advised to ensure strict compliance with the provisions of the extant regulations on the disbursement of forex cash to their respective customers, as any case of infraction will be appropriately sanctioned.”
JP Morgan last week placed Nigeria on a negative watch for about five months following drastic drop in p the country’s foreign exchange position and the bond market which was described as illiquid.
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