Economy

FX platform: CBN sets $100,000 minimum trade for banks

Published

2 weeks ago

November 27, 2024

The Central Bank of Nigeria has issued fresh guidelines for interbank foreign exchange trading via the Electronic Foreign Exchange Matching System, mandating a minimum trade value of $100,000.

The directive, dated 25 November 2024 and signed by Dr Omolara Duke, CBN’s Director of the Financial Markets Department, is part of efforts to ensure transparency, efficiency, and compliance within Nigeria’s FX market.

According to a new set of guidelines released by the CBN on Tuesday, the EFEMS is designed to streamline interbank FX trading, reduce counterparty risks, and ensure adherence to CBN regulations.

The apex bank has designated Bloomberg’s BMatch as the official order-matching platform for interbank transactions, with trading hours set between 9:00 am and 4:00 pm West Africa Time on business days.

One notable provision in the guidelines is the enforcement of a $100,000 minimum tradable amount, with incremental clip sizes of $50,000.

The EFEMS is also limited to spot FX transactions involving the Nigerian naira and the United States dollar.

The CBN, however, retains the discretion to introduce other currency pairs when deemed necessary.

The guidelines document read, “All trades consummated on EFEMS are binding unless canceled by mutual agreement of both parties with written approval from the CBN.

“The minimum tradable amount is US$100,000.00, with incremental clip sizes of US$50,000.00.

“Participants must set credit and settlement limits for other counterparties in the system. Transactions exceeding these limits will not be executed.

“Participants must have adequate credit and settlement limits set for the CBN as its counterparty bank.

“Participants are required to comply with the Nigerian Foreign Exchange Code and other CBN regulations.”

Participation in the EFEMS is limited to authorised dealer banks licensed by the CBN, while other institutions wishing to join the platform must first obtain prior approval.

Participants are also required to execute agreements with the CBN-approved platform provider, maintain accurate profiles, and operate within prescribed credit and settlement limits.

Withdrawal from the platform must be preceded by a 30-day notice, along with the resolution of any outstanding obligations.

Also, trades conducted via the platform will remain anonymous until matched. Counterparty details will only be revealed once transactions are concluded, in line with settlement protocols.

Transactions exceeding set limits or conducted outside EFEMS parameters must be reported promptly and logged onto the FX blotter within 10 minutes.

The CBN emphasised that it will closely monitor all transactions on EFEMS to ensure market integrity and transparency.

Participants are required to submit daily reports detailing trade volumes, settlement statuses, and counterparties.

The central bank also reserves the right to publish aggregated or disaggregated trade data for market analysis, subject to confidentiality agreements.

Any violations of the EFEMS guidelines or related regulations will attract strict penalties, including the suspension or revocation of access rights.

The CBN further stated that it will periodically review the platform’s operations to ensure efficiency and compliance with its directives.

In a separate document on Tuesday, the CBN announced that the Bloomberg BMatch system will officially go live as the EFEMS for foreign exchange trading on December 2, 2024.

The CBN outlined that all authorised dealers and banks in the interbank FX market are required to deploy the Bloomberg BMatch system for their trading activities.

The system aims to ensure uniformity and seamless trading among market participants while enabling the CBN to effectively monitor market performance and data management.

The central bank urged banks to liaise with Bloomberg representatives to expedite the onboarding process and address any technical or operational issues promptly.

Related Topics:CBN Dollar Naira Nigeria Nigerian

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Economy

SEE Black Market Dollar To Naira Exchange Rate Today, 7th December 2024 Can Be Accessed Below

Published

2 days ago

December 7, 2024

Naijablitznews

The official naira black market exchange rate in Nigeria today including the Black Market rates, Bureau De Change (BDC), and CBN rates.

Please note that the exchange rate is subject to hourly fluctuations influenced by the supply and demand of dollars in the market. As of now, you can purchase 1 dollar at a certain rate now, however, it’s important to remember that the rate can shift (either upwards or downwards) within hours.

How much is a dollar to naira today in the black market?

Dollar to naira exchange rate today black market (Aboki dollar rate):

According to Bureau De Change (BDC) sources, the exchange rate for a dollar to naira at Lagos Parallel Market (Black Market) players bought a dollar for N1550 and sold it for N1560 on Saturday, December 7th, 2024.

Please note that the Central Bank of Nigeria (CBN) does not recognize the parallel market (black market), as it has directed individuals who want to engage in Forex to approach their respective banks.

Dollar to Naira Black Market Rate Today
Dollar to Naira (USD to NGN) Black Market Exchange Rate Today
Buying Rate N1550
Selling Rate N1560
Dollar to Naira CBN Rate Today
Dollar to Naira (USD to NGN) CBN Rate Today
Buying Rate N1550
Selling Rate N1550
Please note that the rates you buy or sell forex may be different from what is captured in this article because prices vary

Economy

Nigeria’s economy still facing crisis – CBN

Published

3 days ago

December 7, 2024

Kayode Sanni-Arewa

The Central Bank of Nigeria, CBN, has said that Nigeria remains in a financial and economic crisis.

CBN Governor Yemi Cardoso made this statement at the 14th Annual Bankers’ Committee Retreat in Abuja, stressing that it is a situation inherited by the current CBN administration.

He explained that the role of the Bankers’ Committee remains critical towards addressing the challenge as well as reflating the economy.

According to him, the nation faces challenges in how to address poverty, rising inflation, infrastructure deficits, insecurity, and unemployment, among others.

The apex bank boss called on members of the Bankers’ Committee to reflect on the past year’s challenges and devise actionable tools to address them effectively.

Speaking, the Special Adviser to the President on Economic Affairs, Tope Fasua, expressed concerns over excess charges by operators of Point of Sale, PoS, while calling on the apex bank as well as deposit money banks to make cash available at all ATM points.

The three-day event brings together key players in the banking sector and has the theme “Contract and Commitment to National Development and Economic Growth.”

Economy

Nigeria recorded N5.81tn trade surplus in Q3 – NBS

Published

3 days ago

December 7, 2024

Kayode Sanni-Arewa

Nigeria has recorded a trade surplus of N5.81tn in the third quarter of 2024, reflecting a remarkable rise in export earnings, according to the latest data from the National Bureau of Statistics.

However, the surplus recorded in Q3 2024 is far lower than the N6.95tn trade surplus recorded in the previous quarter.

The NBS in its foreign trade statistics report on Friday noted that Nigeria’s merchandise trade for the Q3 2024 was a total value of N35.16tn, marking an 81.35 per cent increase compared to the same period in 2023 and a 13.26 per cent rise from the previous quarter.

Total exports for the quarter surged by 98.00 per cent to N20.49tn, compared to N10.35tn in Q3 2023.

This marks a 16.76 per cent increase from N17.55tn in the preceding quarter, Q2 2024.

The NBS report read, “Total exports in Q3 2024 were valued at N20.49tn, reflecting a 98.00 per cent rise compared to N10.35tn in the corresponding quarter of 2023 and a 16.76 per cent increase compared to N17.55tn in Q2 2024.”

The significant boost in exports was primarily driven by Nigeria’s crude oil and natural gas exports, which remain key contributors to the country’s foreign exchange earnings.

Crude oil exports alone amounted to N13.41tn, a 57.06 per cent increase from N8.54tn in Q3 2023.

Exports of other oil products, including liquefied natural gas and petroleum gases, also saw a massive 303.93 per cent rise, totalling N4.58tn.

In addition to oil exports, agricultural exports saw an extraordinary increase of 301.87 per cent, reaching N884.07bn, compared to N219.99bn in Q3 2023.

This growth was despite a slight decline of 9.20 per cent from the previous quarter.

Exports of solid minerals and manufactured goods also performed well, rising by 86.58 per cent and 419.93 per cent respectively.

Spain was Nigeria’s largest export partner in Q3 2024, followed by the United States, France, the Netherlands, and Italy.

These countries benefitted from Nigeria’s crude oil, LNG, and other petroleum exports.

On the imports side, Nigeria’s total import bill for Q3 2024 stood at N14.67tn, an increase of 62.30 per cent from N9.04tn recorded in the same period in 2023.

Compared to the previous quarter, imports rose by 8.71 per cent.

The report read, “The value of total imports stood at N14.67tn in the third quarter of 2024, representing a rise of 62.30 per cent from the value recorded in the corresponding quarter of 2023 (N9.04tn) and increased by 8.71 per cent compared with the value recorded in Q2, 2024 (N13.5tn).”

The rise in imports was driven largely by manufactured goods, which increased by 76.44 per cent to N6.98tn, and raw materials, which saw a 66.11 per cent rise to N1.58tn.

Other notable imports included agricultural products, valued at N882.24bn, reflecting a 37.06 per cent increase from Q3 2023.

China continued to dominate Nigeria’s import trade, followed by India, Belgium, the United States, and Malta.

Key imported goods included motor spirit, gas oil, durum wheat, and used vehicles.