Central Bank of Nigeria Officially Appoints 16 Banks as Primary Dealers of Foreign Exchange

CBN Governor, Godwin Emefiele

 

The Central Bank of Nigeria (CBN) has officially approved 16 commercial banks to participate in the market as primary dealers of the new flexible foreign exchange policy.

 

The number of dealers is six more than the initial 10 the CBN governor, Godwin Emefiele, said would be appointed to play in the new market which took off on Monday.

 

According to a CBN source who disclosed to Premium Times on Thursday in Abuja, at least 16 of country’s top banks met the criteria for selection as primary dealers in the market.

 

Recall that at the unveiling of the new FX policy last week, CBN governor, Godwin Emefiele, said that only 10 banks with financial capacity to handle a minimum volume of $10 million deal, would be appointed to work with the CBN as primary dealers when the market formally opens.

 

The primary dealers, the CBN governor explained, would operate with other dealers in the Inter-bank market in line with stipulated foreign exchange primary dealers (FXPD) guidelines, while CBN’s participation would be limited to periodic interventions to either buy or sell FX as the need arises.

 

The source at the CBN, said that prior to the formal opening of the new FX market on Monday, all banks were given the opportunity to show capacity to participate in the market.

 

According to the source, apart from three merchant banks that were unable to respond, all interested banks submitted applications after reviewing the stipulated guidelines for prospective dealers, at the end of which 16 of them were considered qualified as primary dealers.

 

He however refused to name the 16 selected banks, saying in view of the CBN’s determination not to be seen as influencing the independence of the market, it was advisable that only the affected banks would be allowed to make such disclosures.