Economy
FG, CBN’s Silence Create Confusion as Traders, Supermarkets, Others Reject Old Naira Notes
By Dipo Olowookere
The inability of the federal government and the Central Bank of Nigeria (CBN) to give a direction on the old Naira notes, which the apex bank earlier said would cease to be legal tender in the country from February 10, 2023, is creating confusion.
Business Post gathered that in Lagos, some traders, supermarkets, eateries and others now reject old Naira notes; N200, N500, and N1,000. They insist on collecting the redesigned currencies or being paid through the Point of Sale (POS) machine.
At one of the prominent eateries on the Egbeda-Idimu Road in the Egbeda area of Lagos, customers expressed bitterness over the refusal of the management of the facility to accept payment with the old notes on Friday night.
“I wanted to pay for the food I bought, but I was told they would not accept the old currency notes except the new ones. I had to use my debit card to pay through their POS machine,” one of the customers, Mr Aigbe James, told this reporter.
Recall that on Wednesday, the Supreme Court granted an interim injunction sought by the Governors of Kaduna, Kogi, and Zamfara States, to stop the implementation of the deadline of the currency swap policy of the central bank.
The Governors claimed that the policy was making residents of their states go through untold hardship as it was already causing protests in some parts of the country.
The apex court ruled that the status quo should be maintained until the matter is heard next Wednesday. This meant that the old and new notes should be allowed to co-exist until a final judgement is given.
On Friday, an emergency Council of State meeting was conveyed by President Muhammadu Buhari to discuss the policy and others, including the general elections starting in two weeks’ time.
Briefing newsmen after the meeting, the Attorney-General of the Federation and Minister of Justice, Mr Abubakar Malami, said the council threw its weight behind the policy but advised the CBN to print more banknotes or recirculate the old Naira notes to ease the cash crunch in the country. He also said the government was advised to obey the Supreme Court order, meaning the deadline will no longer be applicable.
But some banks sent messages to their customers yesterday, informing them that the deadline remained February 10.
“The old designs of N200, N500 and N1000 will no longer be accepted as legal tender after today, February 10, 2023. Deposit your old notes now at any of our branches,” one of the banks stated.
At the Ikeja area of Lagos State on Saturday, some traders at the popular Computer Village refused to accept the old notes.
It was a similar story in Maryland as a few supermarkets visited by this reporter rejected the old Naira notes, insisting on the new currency notes or card payments.
Those who spoke with this newspaper stressed that their refusal was because the government was yet to speak on the deadline and do not want to lose their money.
When reminded that the CBN had earlier said after the deadline, Nigerians could still deposit their old notes till February 17, the respondents said they just want to be on the safer side.
Meanwhile, some POS operators still accept the old banknotes, especially as they battle with getting the new notes.
“I still accept the old notes because I can still take them to the bank before February 17.
“Getting the new notes is very difficult, and we purchase the old notes at an exorbitant price. I pay between 10,000 and N17,000 to get N100,000 in old notes in this area; that is why we charge our customers almost N2,000 for N10,000.
“Some people think we are taking advantage of the situation to hike our charges, but it is not our fault. I am only buying [the old notes] because I don’t want to go out of business,” one of the operators in the Iyana Ipaja area of Lagos State, Ms Toyin Sokoya, informed Business Post.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange closed flat on Wednesday, August 5, as the market witnessed weaker trading activity with only two deals executed.
In the midweek session, the volume of securities exchanged by investors dropped 99.9 per cent to 802 units from the 1.6 million units recorded on Tuesday. The value of securities further decreased by 99.6 per cent to N208,240 from the preceding session’s N47.6 million, and the number of deals significantly went down by 93.9 per cent to two deals from the 33 deals recorded a day earlier.
Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and Central Securities Clearing System (CSCS) Plc with 76.9 million units transacted for N5.5 billion.
GNI Plc was also the most active stock by volume on a year-to-date basis, with 3.4 billion units exchanged for N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.
There were no price gainers or losers yesterday.
As a result, the market capitalisation stood unmoving at N2.739 trillion, while the NASD Security Index (NSI) remained unchanged at 4,563.96 points.
By Adedapo Adesanya
The Naira slid against the US Dollar by N2.28 or 0.17 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Wednesday, August 5, to N1,363.85/$1 from N1,362.55/$1.
The local currency also declined against the Pound Sterling in the official market during the session by N5.97 to close at N1,837.38/£1 compared with Tuesday’s closing rate of N1,831.41/£1, and against the Euro, it crashed by N6.54 to quote at N1,575.25/€1 versus the preceding session’s N1,568.71/€1.
But at the black market, the Nigerian Naira traded flat against the greenback yesterday at N1,400/$1, and also remained unchanged at the GTBank FX desk at N1,373/$1.
The Central Bank of Nigeria (CBN) says rates have narrowed to below two per cent, while the country’s external reserves have risen above $52.5 billion, reflecting the impact of its ongoing monetary and foreign exchange reforms.
CBN Governor Yemi Cardoso, represented by the Acting Director of Corporate Communications and Investor Relations, Mrs Hakama Sidi-Ali, disclosed this on Tuesday during the CBN Fair in Gombe. He noted that reforms introduced since 2023 had significantly reduced the disparity between the official FX market and the parallel market.
“The Naira continues to strengthen, with the spread between official and Bureau de Change rates now below two per cent,” he said, adding that reserves at $52.5 billion were supported by sustained inflows and renewed investor confidence in the economy.
Interbank FX transactions slid as weaker market activities dropped total Dollar volume exchanged to $75.35 million, a 51.8 per cent decline from $156.23 million in turnover quoted at the previous close.
The deals at the NFEM window also fell as data from the central bank put Wednesday’s quote at 82 from 139.
In the cryptocurrency market, major were down as global risk sentiment softened as a key world equity index slipped and chipmakers fell.
The MSCI All Country World Index snapped a five-day run to fall 0.2 per cent as chipmakers retreated on both sides of the Pacific. South Korea’s Kospi, a bellwether for the AI trade, dropped 4.4 per cent.
Ripple (XRP) depleted by 1.7 per cent to $1.05, Binance Coin (BNB) decreased by 1.0 per cent to $594.87, Cardano (ADA) depreciated by 0.9 per cent to $0.1884, TRON (TRX) shrank by 0.2 per cent to $0.3261, Solana (SOL) crumbled by 0.1 per cent to $74.00, and Dogecoin (DOGE) went down by 0.1 per cent to $0.0697.
On the flip side, Ethereum (ETH) gained 2.3 per cent to trade at $1,911.41, and Bitcoin (BTC) rose by 0.8 per cent to $64,759.28, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
By Dipo Olowookere
The domestic stock exchange rebounded by 0.05 per cent on Wednesday on the back of renewed bargain-hunting by investors, though the level of activity waned.
After bleeding for a few days, the Nigerian Exchange (NGX) Limited heaved a sigh of relief yesterday, as the All-Share Index (ASI) gained 109.41 points to close at 244,912.24 points compared with the previous day’s 244,802.83 points, and the market capitalisation garnered N71 billion to settle at N158.087 trillion versus Tuesday’s N158.016 trillion.
Business Post reports that despite the rebound recorded by Customs Street at midweek, the market breadth index remained negative, as there were 20 price advancers and 29 price decliners, implying bearish investor sentiment.
Linkage Assurance appreciated by 9.94 per cent to N1.77, AVA Capital rose by 9.55 per cent to N10.90, Fortis Global Insurance advanced by 7.69 per cent to N2.80, McNichols gained 7.34 per cent to finish at N5.85, and Coronation Insurance surged by 5.51 per cent to N2.49.
Conversely, Honeywell Flour depreciated by 9.94 per cent to N16.30, PZ Cussons gave up 9.94 per cent to trade at N74.75, Zichis crashed by 9.74 per cent to N20.76, Learn Africa slipped by 9.62 per cent to N9.40, and Neimeth tumbled by 8.33 per cent to N8.25.
The busiest equity was FCMB, with a turnover of 369.2 million units valued at N4.1 billion. Chams transacted 46.7 million units worth N201.8 million, First Holdco transacted 43.5 million units for N5.7 billion, Access Holdings sold 29.8 million units worth N778.0 million, and Linkage Assurance exchanged 19.6 million units valued at N33.5 million.
At the close of transactions, market participants bought and sold 824.1 million units worth N25.5 billion in 48,114 deals, in contrast to the 1.6 billion units sold for N28.7 billion in 54,160 deals a day earlier, showing a shortfall in the trading volume, value, and number of deals by 48.49 per cent, 11.15 per cent, and 11.16 per cent, respectively.
