The Central Bank of Nigeria (CBN) has been called upon by stakeholders to penalise banks violating its rules on foreign exchange (forex) transactions.
More than 16 lenders were recently accused by the apex bank of violating its forex rules, including not obeying directives on selling forex to Small and Medium Enterprises (SMEs) and also not keen on taking up forex allocations from the regulator.
On several occasions, dollars made available by the CBN were not fully bought by the banks because of their unwillingness to sell to SMEs.
For instance, the CBN last week, confirmed excess availability of forex at the interbank market, as banks fail to fully subscribe to the $150 million offered by the apex bank.
Information from the regulator indicated that the dealers could only pick the sum of $43.5 million, which represents 29 per cent of the $150 million offered for subscription in the wholesale segment of the foreign exchange market.
Confirming this development, Isaac Okorafor, the apex bank’s spokesman, reaffirmed the bank’s position to sustain the intervention with a view to making foreign exchange available for all genuine transactions eligible for foreign exchange through the CBN window.
Speaking on the development, a financial expert based in Lagos, Ernest Chukwu, urged the CBN to impose severe sanctions on the banks for their non-compliance with stipulated guidelines.
While speaking with The Nation, Chukwu said the apex bank should regulate the market and punish violators of its rules, adding that some banks deliberately refused to publish their forex renditions, which is against the apex bank’s rule.
“The CBN should regulate the market effectively and sanction operators hampering liquidity in the market and those that fail to publish forex transaction reports,” he said.
A forex dealer, Abiodun Akindele,agreed with Chukwu. He added: “One thing I notice is that banks will always like to play smart but this is not the time to do so because such practice is not in the interest of the economy. The banks must learn to protect the economy and help the CBN achieve its exchange rate stability objectives,” he said.
He enjoined financial institutions to ‘play by the rules’, adding that the interest of the nation’s economy should be paramount in their heart.
“Banks should start to play by the rules in the interest of the economy .They should be patriotic in terms of sales to the third party. They shouldn’t disturb the flow because the economy is fragile. Excess unavailability has plunged us in the state in which we are and everyone is a victim, so every bank should play to the rules and obey market,” he said.