The Central Bank of Nigeria Governor, Olayemi Cardoso, has vowed to pursue an aggressive regulatory environment to reduce infractions in the country’s banking system.
He said this on Tuesday in Abuja at the Monetary Policy Committee meeting of the apex bank, the first since he assumed office in September 2023.
He also stated that an in-depth investigation was underway to determine the necessary actions against banks involved in infractions, stressing that the bank was in the process of formulating “stringent regulations” to cleanse and purify the country’s foreign exchange market.
The governor, responding to questions on steps taken to promote trading on the foreign exchange market, also revealed that its foreign reserves increased to $34bn as of February 20, up by $2bn from the $32.23bn recorded at the end of January.
The naira has depreciated to an all-time low since the new administration floated the currency and unified the exchange rate windows.
The Nigerian currency weakened from over N700/$1 in May 2023 to over N1,500/$1 on Tuesday.
However, Cardoso said that the apex bank was moving to a “very aggressive regulatory environment”, adding that the CBN would do all within its powers to curb arbitrage aided by banks and BDCs.
He said, “What we are doing at the moment is a collaboration between the central bank and the law enforcement agencies to ensure that we can understand better what is going on in the market and where infractions are taking place. They will be speedily dealt with.
“Now, I must say that we are moving as far as the central bank is concerned, we are moving to a very aggressive regulatory environment, where those policies have been coming out, as you can see, and tolerance for people not to abide by the regulations that are coming out and to comply is zero.
According to Cardoso, the apex bank would continue to make the market more liquid and to ensure that those who are genuine and want to abide by the rules and regulations that have been set by the central bank will be free to do so, adding that those who do not should be ready to face the consequences.
He revealed that the apex bank had paid another $400m out of $2.2bn of valid FX backlog to those who were genuinely identified.
According to the CBN governor, the bank will work to restore the confidence of the public and remains committed to its FX backlog to businesses being owed.
