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Bureau De Change operators seek deadline extension

25 June 2014, 20:09

Lagos - Bureau De Change (BDC) operators have urged the Central Bank of Nigeria (CBN) to extend the deadline for the new capital requirement released for the industry.

The BDCs operators noted that the July 15 deadline was very short.

They said that the deadline would hamper economic growth, lead to the closure of many BDCs and loss of jobs, if the recapitalisation time frame was not reviewed.

They also queried the criteria used by the new Governor of CBN at arriving to the time frame, stressing that commercial banks were given enough time to increase their capital base.

The managing director of a BDC,who pleaded anonymity, said that it would be difficult to raise N35 million within three weeks.

The operator said that even quoted companies on the Nigerian Stock Exchange (NSE) could not raise fresh capital within the stipulated time frame because of the long process of fund raising.

He said that BDCs were privately owned and could only raise capital through private placement of shares to an individual or group of individuals.

According to him, no proprietor of BDC can get a buyer for a property within 30 days.

Another operator said the new capital requirement would not solve the problem of the industry.

He said that "BDC does not require huge capital because they don't give loans to people.

"They only buy currencies in accordance to CBN approval”.

The operator, who blamed CBN for the rot in the industry, said that the government bank failed to adhere to its licencing procedure.

The operator said that the apex bank approved licences to every "dick and harry” unlike when only professionals were given operational licence.

He alleged that many managing directors of BDCs could not read or write, noting that in the past promoters of BDCs must have a minimum of 10 years financial experience.

The operator said that profiteering in the industry would be solved through proper scrutiny and adherence to licencing rules and procedure.

The CBN had on June 22 released fresh guidelines for BDC operators and raised the operating capital base to N35 million from N10 million to check persistent depletion in the country’s external reserves.


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