Adedapo Adesanya
By Adedapo Adesanya
The Central Bank of Nigeria (CBN) has assured that there are no plans to convert about $30 billion domiciliary deposits to Naira.
The apex bank in a short response on its X, formerly known as Twitter, account on Saturday said the reports by the Nigerian Daily, and The Punch Newspaper were fake.
“No plans to convert $30bn domiciliary deposits to naira. This news is fake!,” the CBN wrote.
The newspapers had reported that, “The federal government is mulling a policy that will result in the conversion of foreign currencies in domiciliary accounts of citizens to naira to stabilise the national currency, which earlier this week recorded its worst performance in history.”
The platforms quoted a source from the presidency that “the Federal Government would not fold its arms and continue to watch some individuals hoarding foreign currencies at the expense of the naira.”
The possibility of converting funds in domiciliary accounts to the local Naira has sent shivers across the financial community, as they take the move to hedge the weakening Naira.
Proponents of the move have claimed that funds held in domiciliary accounts and those held by Nigerians abroad into massive investments in various sectors of the economy would help staunch the foreign exchange (FX) crisis faced in the country.
Regardless of this, the CBN this week implemented some set of policies to help the market. It issued a directive on financial markets price transparency which mandates banks to report values of transactions; implemented a change in market rate pricing methodology; kicked against banks hoarding forex in case of speculation; and removed caps on international money transactions.
On Friday, the lender stopped daily Cash Reserve Requirement (CRR) debits for banks and will be adopting an updated CRR mechanism that is intended to facilitate banks’ capacity for planning, monitoring and aligning with records with the CBN.
