Economy
Foreign reserves falls by $1.3bn, CBN confirms
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Nigeria’s foreign exchange reserves fell by $1.31bn in February 2025, reflecting sustained external pressures amid the recent appreciation of the naira.
Data from the Central Bank of Nigeria showed that reserves declined from $39.72bn on January 31, 2025, to $38.42bn on February 28, 2025, representing a 3.3 per cent drop within the month.
The decline in February was slightly higher than the $1.16bn drop recorded in January, highlighting the continued strain on the country’s external reserves.
The steady depletion of reserves has raised concerns amid rising speculations that the apex bank’s sustained interventions in the foreign exchange market, aimed at bridging liquidity gaps and stabilising the naira, have come at the cost of reducing external reserves.
Despite this, the local currency strengthened significantly against major foreign currencies in February, suggesting that the CBN’s efforts have had some positive impact in restoring confidence in the market.
Nigeria’s reserves recorded a consistent decline throughout February, with no single day of increase.
At the beginning of the month, reserves stood at $39.60bn on February 3, dropping to $39.54bn on February 4, signalling the start of a downward trend.
By February 7, reserves had fallen to $39.04bn, slipping further to $39.27bn on February 10.
The downward trajectory persisted into the second week of the month, with reserves standing at $39.15bn on February 12 and declining to $38.88bn by February 17.
By the third week of February, reserves had weakened further, dropping to $38.72bn on February 19 and $38.69bn on February 21.
As the month drew to a close, reserves had further declined to $38.41bn on February 28, reflecting a continuous downward trend throughout the month.
The fall in reserves has been attributed to multiple factors, including Nigeria’s heavy dependence on imports, which exerts pressure on foreign exchange reserves.
The country remains highly reliant on imports of industrial goods and food supplies, leading to high FX outflows.
Although oil prices have rebounded in recent months, Nigeria’s oil production challenges, crude theft, and pipeline vandalism have constrained forex inflows from the oil sector, limiting the CBN’s ability to shore up reserves.
The depletion of external reserves has also raised concerns over Nigeria’s capacity to meet external debt obligations.
The country holds significant foreign debt, and a further decline in reserves could weaken its ability to make timely debt repayments, potentially increasing borrowing costs.
A lower reserve level could also affect Nigeria’s credit rating and investor confidence, making it more expensive for the government to access international capital markets.
Despite the steady decline in reserves, the naira made notable gains against major foreign currencies in February, marking its strongest performance since the beginning of the year.
By the end of the month, the naira appreciated against the US dollar, closing at N1,540/$ from N1,620/$ at the start of the month, reflecting a 7.41 per cent gain.
It also strengthened against the British pound, rising from N2,000/£ to N1,910/£, marking a 4.50 per cent increase. Similarly, the naira appreciated against the euro, improving from N1,660/€ to N1,550/€, showing a 6.34 per cent gain.
The official exchange rate followed a similar trend, stabilising above N1,500/$ in the final weeks of February.
Data from the Nigerian Autonomous Foreign Exchange Market showed that the naira closed at N1,496/$ at the official window, narrowing the gap between the official and parallel market rates.
The convergence of the official and parallel market exchange rates indicates that Nigeria may be moving towards a unified forex market, reducing the speculation and arbitrage that have previously contributed to forex volatility.
The Naira yesterday appreciated to N1,387 per dollar from N1,390 in the parallel market on Monday.
Similarly, the naira appreciated to N1,322.9 per dollar in the Nigerian Foreign Exchange Market, NFEM.
Data from the Central Bank of Nigeria, CBN, showed that the indicative exchange rate for the naira fell to N1,322.9 per dollar from N1,320 per dollar on Monday, indicating N2.9 appreciation for the local currency.
Consequently, the margin between the parallel and official markets narrowed to N64.1 per dollar from N70 per dollar on Monday. The value of interbank turnover in NFEM declined by 48.07 percent to $55.6 million from $107.07 million on Monday.
The Central Bank of Nigeria (CBN) has announced that it will be paying closer attention to how banks and other financial institutions in the country are being used, or misused, to move money that could fund terrorism.
In a statement signed by Hakama Sidi-Ali, Acting Director of the apex bank’s Corporate Communications and Investor Relations Department on Tuesday, the CBN said it has made terrorism financing supervision one of its current priorities. According to the statement, this is part of the bank’s “ongoing commitment to protecting the Nigerian financial system from abuse by illicit actors.”
What this means in plain terms is that the CBN will be looking more closely at how banks identify and manage the risk of their platforms being used to fund terrorism, how well they monitor suspicious transactions linked to terrorism financing, how they carry out sanctions ordered against specific individuals or groups, and how promptly they report suspicious activity connected to terrorism financing.
The statement explained that this new push covers four broad areas: how financial institutions manage terrorism financing risk, how they monitor transactions for signs of terrorism financing, how they carry out targeted financial sanctions, and how they report suspicious transactions linked to terrorism.
The apex bank said it will not be sitting back and waiting for problems to surface on their own. Instead, it plans to use a risk-based approach, which means banks and institutions seen as more exposed to this kind of risk will attract closer attention.
This will involve both on-site inspections, where CBN officials visit institutions directly, and off-site checks, where the bank reviews reports and data from a distance.
The goal, the statement said, is to support “effective Anti-Money Laundering, Countering the Financing of Terrorism and Countering Proliferation Financing (AML/CFT/CPF) controls across the financial sector,” referring to the fight against money laundering, terrorism financing, and the financing of weapons proliferation, all of which are governed by existing Nigerian laws and regulations.
The CBN also linked this move to Nigeria’s wider efforts, both at home and internationally, to fight terrorism financing and the financing of weapons proliferation, and to protect the integrity of the country’s financial system.
The apex Bank did not name any specific institution under investigation or give a timeline for these actions, but noted that “further supervisory engagement will be undertaken as appropriate,” suggesting that more steps could follow depending on what its checks turn up.
For the ordinary Nigerian, the announcement signals that the CBN wants banks to be more careful and more accountable in how they track the movement of money through the financial system, particularly where there is any possible link to terrorism or the funding of violent groups.
It is also a reminder that financial institutions operating in Nigeria are expected to follow strict rules designed to keep the banking system safe from being used for illegal purposes.
The Federal Government has approved a new pensionable salary structure for personnel of the Nigerian Armed Forces.
The new structure affects personnel in the Nigerian Army, Nigerian Navy and Nigerian Air Force and took effect from September 1, 2026.
The approval was contained in a circular issued on September 3 by the National Salaries, Incomes and Wages Commission.
Under the new arrangement, Generals, Admirals and Air Chief Marshals occupy the highest level, with their annual pensionable salaries ranging from ₦21.9 million to ₦29.75 million, depending on their salary steps.
The highest figure works out to roughly ₦2.48 million per month when divided by 12.
Lieutenant Generals, Vice Admirals and Air Marshals will have annual pensionable salaries between ₦16.99 million and ₦25.91 million.
Major Generals, Rear Admirals and Air Vice Marshals will receive pensionable salaries ranging from about ₦14.98 million to ₦23.9 million annually.
For Brigadier Generals, Commodores and Air Commodores, the approved annual pensionable figures range from ₦13.86 million to ₦16.39 million.
Colonels, Captains and Group Captains will have annual pensionable salaries between ₦8.31 million and ₦9.49 million, while Lieutenant Colonels, Commanders and Wing Commanders will fall between ₦7.55 million and ₦8.74 million.
Majors, Lieutenant Commanders and Squadron Leaders will have pensionable salaries ranging from ₦5.99 million to ₦7.01 million annually.
Captains, Lieutenants and Flight Lieutenants will receive between ₦5.28 million and ₦6.42 million.
At the junior officer level, Second Lieutenants, Midshipmen and Pilot Officers will have annual pensionable salaries ranging from ₦4.92 million to ₦5.59 million.
The new structure also covers non-commissioned personnel.
Warrant Officers across the three services will have annual pensionable salaries between ₦4.53 million and ₦5.17 million, while Master Warrant Officers will receive between ₦3.94 million and ₦4.93 million.
Warrant Officers will have annual pensionable salaries ranging from ₦3.46 million to ₦4.35 million. Staff Sergeants, Petty Officers and Flight Sergeants will have figures between ₦2.98 million and ₦3.76 million.
Sergeants and Leading Seamen will have annual pensionable salaries ranging from ₦2.81 million to ₦3.16 million, while Corporals and Able Seamen will receive between ₦2.48 million and ₦2.73 million.
Lance Corporals and Seamen will have pensionable salaries between ₦2.32 million and ₦2.58 million annually.
Privates, Ordinary Seamen and Aircraftmen will have figures ranging from ₦2.28 million to ₦2.49 million.
The government clarified that the amounts contained in the new schedule are meant for calculating pension benefits.
They should not be treated as the actual monthly salaries or take-home pay of serving military personnel.
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