Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.


Banks struggle to meet $5 bn forex obligations

22 December 2015, 15:35

Abuja - Nigerian banks are struggling to meet $5 billion foreign exchange obligations to importers and correspondent banks, reflecting the worsening foreign exchange situation in the country, Vanguard reports.

This was disclosed on Monday, by Renaissance Capital in a report entitled: “Nigerian banks struggling for FX liquidity.”

The report stated that due to the inability to access foreign exchange from the Central Bank of Nigeria (CBN), banks  are having challenges sourcing dollars to meet outstanding foreign exchange, FX, obligations to importers and correspondents banks ranging from $2 billion to $5 billion.

Also read: Forex ban: Union appeals to FG for extension

The report stated: “Declining oil prices and the unwillingness of the government/Central Bank of Nigeria (CBN) to devalue the naira amidst constrained reserves continue to worsen the FX liquidity position of the Nigerian banks. We highlight the sector’s challenges across four fronts, and believe that, should this trend persist in a weak oil price environment, asset quality and international obligation default risks could be significant.

“Nigeria is dependent on imports, which Nigerian banks facilitate via the opening of letters of credit (LC). The customer typically repays these after imports are sold; the customer therefore earns naira, then approaches the banks to source FX from the CBN (or goes to the black market), with which the correspondent bank is repaid.

“With the CBN struggling to provide sufficient FX to meet importers’ FX demands and banks prevented from accepting FX deposits, not only have importers been unable to repay their obligations, they have also struggled to keep afloat – among them import dependent manufacturers.

“As importers have struggled to access FX, the Nigerian banks have used their FX liquidity to settle with the correspondent banks (given the LCs are guarantees), in anticipation of the CBN providing liquidity.”

Read more at Vanguard

- News 24

Tags nigeria forex

Buhari facilitates with Afe at age 85

28 October 2016, 18:04

Read more from our Users

Nigeria @ 56: Words to my green f...

A leader’s job is not to dictate, but rather to be respected, admired and be a trustee, of the land we love, with so much potential, a land which should be freer than free. Its still a long way to fufilling our destiny! Read more...

Submitted by
Isaac Asabor263
Recession: An opportunity for Nig...

The recession should be seen as an opportunity for the country’s promotion as long as we all collectively conduct ourselves in a patriotic manner, writes Isaac Asabor.  Read more...

Submitted by
Black and White

We want to imitate the whites in everything because we are ignorant of our inherent originality and content. We spend all our Naira to acquire his inventions because we so oblivious of our natural endowments that we allow him have it for free. Read more...

Submitted by
Nate Nat
Adamawa State University Mubi: A ...

ADSU integrity forum has accused the Sunday Joshua Wugira, a lawyer, of adopting unorthodox tactics by abusing his privilege by attacking the integrity of ADSU Vice Chancellor Dr. Moses Zira Zaruwa, writes a News24 reader. Read more...

Submitted by
Abdulsalam Jubril
My Country Nigeria (Part One)

Poetry by Abdulsalam Jubril.

Submitted by
Abdulsalam Jubril
Recession, dearth in leadership a...

Every leader has the opportunity to become great and making himself immortal in the lives and hearts of people for generations to come. Will Mr. President seize this opportunity?, questions Abdulsalam Jubril. Read more...