By 
The Central Bank of Nigeria (CBN) announced on Friday new guidelines for Deposit Money Banks (DMBs) to deposit excess foreign currency notes at its Lagos and Abuja branches. This initiative aims to achieve convergence between the parallel and official market exchange rates.
The directive was detailed in a circular to all commercial banks, signed by Solaja Olayemi, the Acting Director of the Currency Operations Department.
“To deepen the foreign exchange market, boost liquidity, and achieve convergence in the exchange rates of the parallel and official markets, the CBN has approved that DMBs may deposit their excess foreign currency notes at the Lagos and Abuja branches of the bank,” the circular stated.
The CBN explained that this approval responds to increasing demands from banks to transfer their forex cash to the central bank for onward credit to their offshore accounts with correspondent banks. However, the approval includes strict guidelines that all DMBs must follow, effective immediately.
Key directives include a mandatory three-working-day notice in writing to the Branch Controller at CBN Lagos or Abuja, detailing the owners of the foreign currency to be deposited. The deposit thresholds are set at a maximum of $10 million for higher denominations (USD 100 and USD 50) and $1 million for lower denominations (USD 20 and below). Similarly, pounds and euro notes are capped at GBP 1 million and EUR 1 million respectively.
Each deposit must be witnessed and confirmed by two representatives of the depositing bank, with denominations segregated into separate boxes. The use of CBN-registered Cash-in-Transit (CIT) companies is mandated for these transactions.
The deposit window is limited to between 8 am and 12 pm, and deposits will be counted and authenticated on the same day in the presence of bank representatives. The CBN will credit the DMBs’ accounts through their offshore correspondent banks within a T+5 cycle time. A handling charge of 0.30 percent of the authenticated amount will be deducted from the DMBs’ current accounts with the CBN.
The CBN added that non-compliance with any of the guidelines will result in the rejection of forex deposits.
Comments