CBN faults Media Report on Bank’s Finances

… injects $210 million into Forex Market

By Etuka Sunday

The Central Bank of Nigeria (CBN) yesterday faulted the media report on its financial operations, stating categorically that the story was not only false, but an attempt, through sheer mischief, to distort and misrepresent CBN’s financial operations and also to misinform the investing public on the financial health of the country.
CBN said its attention was drawn to the lead story in the BusinessDay newspaper of Monday, June 17, 2019, headlined: “CBN’s life support to FG rises 780% to N8.12trn in 4yrs”.
The apex bank said, in order to arrive at their plot, the authors of the Business Day story had conveniently restricted their report only to CBN’s claims on the Federal Government while ignoring other numerous deposits of the Federal Government, including those of the Treasury Single Account (TSA), with the CBN.
“As can be clearly deduced by any unbiased and informed analyst, when the claims of the FG on CBN are netted against the claims of the CBN on the FG, the resulting net positions indicate that the FG was actually the net creditor to CBN in 2014, 2015 and 2017 to the tune of N2.14 trillion, N1.65 trillion and N0.36 trillion, respectively.
On the other hand, CBN was the net creditor to the FG in 2016 and 2018 to the tune of N0.11 trillion and N0.34 trillion, respectively.
“From the foregoing and the detailed database, it is clearly inappropriate to compare the position as at end-2018 with the position as at end-2014, ignoring the movements within the period.
“We wish therefore to reassure the investing community and the general public that the CBN remains faithful to its statutory mandate as banker and financial adviser to the Federal Government,” CBN said in a statement.
Meanwhile, bank has again injected the sum of $210 million into the inter-bank Foreign Exchange Market.
Figures obtained from the CBN on Tuesday, June 18, 2019, indicated that authorized dealers in the wholesale segment of the market were offered the sum of $100million, while the Small and Medium Enterprises (SMEs) segment received the sum of $55 million. The sum of $55 million was allocated to customers requiring foreign exchange for invisibles such as tuition fees, medical payments and Basic Travel Allowance (BTA), among others.
This was disclosed by the Director, Corporate Communications Department, Central Bank of Nigeria, Mr. Isaac Okorafor, who stressed that the effort of the bank had continued to stabilize the foreign exchange market. This, according to him, had sustained the level of confidence investors and the public had in the Naira.
It will be recalled that at the last intervention on Friday, June 14, 2019, the Bank injected the sum of $256.4million and CNY37.4million into the Retail Secondary Market Intervention Sales (SMIS) segment.
Meanwhile, the Naira on Tuesday, June 18, 2019, exchanged at an average of N362/$1 in the BDC segment of the market.