Regulatory Alerts2014-12-17 | TED/FEM/FPC/GEN/01/026Foreign Exchange Trading Position of Banks at the close of each Business Day (UPDATED)
The Central Bank of Nigeria has observed instability in the foreign exchange market and its impact on exchange rates. To address this, the bank has temporarily reduced the Foreign Exchange Trading Position of authorized dealers to zero percent, down from the previous 1% of Shareholder's Funds unimpaired by losses. Any violation of this directive will result in sanctions, including potential suspension from the Foreign Exchange Market.
TRADE AND EXCHANGE DEPARTMENT 09 46237802 09 46237804 E-mail address: ted@cbn.gov.ng TED/FEM/FPC/GEN/01/026 December 17, 2014 TO: ALL AUTHORIZED DEALERS FOREIGN EXCHANGE TRADING POSITIONS OF BANKS AT THE CLOSE OF EACH BUSINESS DAY The Central Bank of Nigeria has observed the recent development in the Foreign Exchange Market and its consequences on the stability of the exchange rates.
In order to preserve the stability of the market, the Foreign Exchange Trading Position of individual Authorized Dealer, which is currently at 1% of its Shareholder's Funds (SHF) unimpaired by losses, has been temporarily reviewed downward to Zero percent with immediate effect.
Consequently, Authorized Dealers are therefore required to maintain Zero Percent of their shareholder's fund as Foreign Exchange Trading Position at the close of each business day.
Any infraction of the requirement of this circular, in any way whatsoever, will attract appropriate sanction, which may include suspension from the Foreign Exchange Market.
OLAKANMI I. GBADAMOSI DIRECTOR TRADE & EXCHANGE DEPARTMENT