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Why CBN settled additional FX Forwards with banks

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By Chioma Obinagwam

In fulfilment of its commitment to eliminate the backlog of pending matured foreign exchange in Deposit Money Banks (DMBs), the Central Bank of Nigeria (CBN) has recently disbursed approximately US $61.64 million to foreign airlines through various banks. This initiative is part of the CBN’s efforts to decrease its remaining liability to the airlines.

 

The apex bank told Confiance News in a statement on Sunday.

 

This information was confirmed by the Acting Director of the Corporate Communications Department at the CBN, Mrs. Hakama Sidi Ali, in Abuja on Friday, January 5, 2024.

 

Mrs. Sidi Ali further disclosed that, in the past three months, the CBN has also redeemed outstanding forward liabilities amounting to almost USD 2 billion. This underscores the Bank’s commitment to the resolution of pending obligations and a functional foreign exchange market.

 

According to her, these payments signify the CBN’s ongoing efforts to settle all remaining valid forward transactions, with the aim of alleviating the current pressure on the country’s exchange rate.

 

It is anticipated that this initiative by the CBN should provide a considerable boost to the Naira against other major world currencies and further increase investor confidence in the Nigeria economy.

 

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