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Business: Naira Rebounds As Banks Offload Excess Dollars

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Deposit Money Banks on Thursday made frantic efforts to offload their surplus dollar stocks ahead of the midnight February 1, 2024 deadline given by the Central Bank of Nigeria (CBN) to commercial banks to sell all excess foreign exchange holdings.

It was gathered that the treasury departments of the DMBs spent the entire day battling to sell their excess FX holdings. Officials processed several foreign exchange request forms of their customers as they sold more dollars to them.

The increase in the level of forex sale activities at the official foreign exchange market, it was learnt, led to the rebound of the naira at the parallel market on Thursday.

According to The Punch, several top bank executives under anonymity confirmed there were huge forex transactions in the banks.

As of 6pm on Thursday, bank officials especially those of the treasury departments, were making efforts to meet the new prudential requirements of the regulator.

Amid its fresh moves to stabilise the nation’s volatile exchange rate, the CBN had in a circular released on Wednesday, ordered DMBs to sell their excess dollar stocks latest February 1, 2024. The CBN also warned lenders against hoarding excess foreign currencies for profit.

According to officials, the central bank believes some commercial banks hold long-term foreign exchange positions to enable them to profit from the volatile movements of exchange rates.

The new circular introduced a set of guidelines aimed at reducing the risks associated with these practices.

In the circular titled, “Harmonisation of Reporting Requirements on Foreign Currency Exposures of Banks”, the CBN raised concerns over the growing trend of banks holding large foreign currency positions.

The circular read in parts, “The Central Bank of Nigeria has noted with concern the growth in foreign currency exposures of banks through their Net Open Position (NOP). This has created an incentive for banks to hold excess long foreign currency positions, which exposes banks to foreign exchange and other risks.”

The apex bank further directed banks with current NOPs exceeding its limits to adjust their positions and comply with the new regulations by February 1, 2024.

The latest circular came barely 48 hours after the CBN released a circular, warning banks and FX dealers against reporting false exchange rates, among others.

The new development came  on the heels of the adjustment of the methodology used for the calculation of the nation’s official exchange rate by the FMDQ Exchange, a situation that has moved the official exchange to about N1,500 from around N900/dollar.

Following the latest CBN directive which is aimed at unifying the official and parallel market rates of the local unit, several banks sold forex to their customers on Thursday.

The development led to a sharp rebound of the national currency in the official market. Bureau De Change operators in Lagos, Kano, and Abuja also pushed to sell their dollar holding amid fear the local unit might sustain the gain in coming days.

Alhaji Lawan Ismael, a BDC operator in Ikeja, Lagos, said he bought and sold the greenback for N1400/dollar and N1420/dollar, respectively.

Another BDC at the Lagos airport, Sabiu Abdullahi, said the greenback went for between N1400/$ and N1400/$. This, he said, was a huge rebound from over N1500/$ it sold on Wednesday.

In Abuja, the naira traded at the parallel market between N1,300/$ and N1,350/$.

A Bureau De Change (BDC) operator, Ibrahim Yahu told The PUNCH, “Today, because of our small action, you could not get a standard price. Those who bought today did so at risk. But the dollar sold between N1,300 and N1,350.”

The naira closed at N1,455.59/$ at the official window on Wednesday, according to the FMDQ Securities Exchange. This rate has been yet to be updated as of 09:39 pm Thursday.

Commenting on the effect of the circular, bank officials who pleaded anonymity said they were bound to ensure their books remain within the new FX prudential limit.

“All banks working to meet the deadline,” the chief financial officer of a tier-2 bank told said on Thursday evening.

Also, a top official of a tier-1 bank, while commenting on the development, said, “After the CBN directive, we had to push out the FX.”

Another official said, “All banks are pushing out funds now, and we are ready to sell. The key thing is profit here.”

Meanwhile, some bank officials said beyond the FX in banks, the CBN and the security agencies would need to beam their searchlights on politicians and government officials who are hoarding dollars in their homes.

As part of its effort to boost liquidity in the FX market, the CBN on Wednesday issued a new circular that removes the previous cap on exchange rates quoted by International Money Transfer Operators.

In a document titled, ‘Guidelines on International Money Transfer Service in Nigeria,’ the CBN asked IMTOs to make payments to customers only in Nigerian currency while using the prevailing exchange rate on the day the transfer is received.

BIG STORY

Murder Suspect Ayomide Adeleye Charged, Remanded, Police Insist [PHOTO]

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The Lagos State Police Command has clarified that Ayomide Adeleye, who confessed to killing Christianah Idowu, his friend and neighbour, has been charged with “murder” and remains in custody for the offence.

This clarification was issued by the state Police Public Relations Officer, SP Benjamin Hundeyin, in response to reports suggesting that Adeleye was not being held in any Lagos correctional facility.

In his statement, Hundeyin said, “We can confirm that Ayomide Adeleye was charged with murder and was remanded for the same offence.”

“It is also a fact that another person bearing the same name was remanded for a different offence and released in April 2024, long before the Ayomide we are talking about committed his offence.”

“An outfit that prides itself on investigation should live up to its name. Relying on ‘sources’ rather than the spokesperson of the Correctional Service would land you in this kind of misinformation.”

Adeleye, a 200-level Philosophy student at Olabisi Onabanjo University, confessed in September to killing Idowu, a 300-level student at the Federal University of Agriculture, Abeokuta, Ogun State.

On November 5, Adeleye appeared before Magistrate Seyi Omodara at the Ogba Magistrate Court.

The magistrate issued a remand warrant, allowing the police to detain him at the Ikoyi Correctional Center pending advice from the Directorate of Public Prosecutions.

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BIG STORY

Warri Refinery: Oil Marketers Eye Loading Of Petrol February

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Oil marketers have started loading Automotive Gas Oil (diesel) and Kerosene from the Warri Refining and Petrochemical Company.

Dealers confirmed this on Friday, while also requesting Premium Motor Spirit (petrol) from the recently rehabilitated plant.

WRPC, under the management of the Nigerian National Petroleum Company Limited, resumed operations on December 30, 2024, after the Group Chief Executive Officer of NNPCL, Mele Kyari, announced its return to service during a tour of the facility.

Speaking with one of our correspondents at the refinery on Friday, the Chairman of the Delta State chapter of the Independent Petroleum Marketers Association of Nigeria, Harry Okenini, said that while the plant was operational, it was not yet functioning at full capacity.

He, however, pointed out that marketers had begun loading diesel and kerosene from the refinery.

“Right now, there is no production of petrol. So, we are not loading PMS. We hope to load PMS soon. We can confirm to you that the plant is working although not at 100 per cent. And IPMAN, Warri Depot Unit, is waiting for the production of PMS so that we can load.

“For now, only the Automotive Gas Oil, popularly called diesel, and Dual Purpose Kerosene are being produced and loaded out for consumption.

“Hopefully, by February, we are expecting cooking gas, PMS, and other products to come out. As of now, the retail unit is only loading AGO and DPK,” he added.

Also speaking with our correspondents at the refinery, the National Chairman of the Surface Tank and Kerosene Peddlers, a branch of NUPENG, Israel Omokere, confirmed that the refinery was operational.

He said, “Hopefully, the PMS will come on board. We are loading kerosene and AGO for now.”

On his part, the Delta State Chairman of Surface Tank and Kerosene Peddlers branch of NUPENG, Kingsley Erituoyo, said, “For so many years the refinery was down, today the refinery is up.”

Findings at the Warri refinery by our correspondents showed limited truck movements in and out of the complex.

According to The Punch, the activities at WRPC were minimal compared to the refinery’s peak years when it operated at full capacity.

Industry sources revealed that more steps were needed by the Federal Government and NNPCL for the refinery to begin full production of PMS.

During the visit to the WRPC complex, it was also observed that the main entrance appeared almost deserted, with security operatives stopping journalists from taking photographs on the premises.

Sources inside the refinery shared that only one of the three units at the refinery was operational and producing diesel, gas, and kerosene.

“For now, only one unit is working at the refinery. You know there are three units, but only one is in operation, producing diesel, gas, and kerosene.

“The unit can’t give fuel for now. If the second unit starts working, it can produce PMS. It is the last unit to operate because it’s very big and complicated.

“If all units are working, we can load over 100 trucks daily, now it loaded about 50 trucks,” a source said.

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BIG STORY

NDLEA Arrests Famous 61-Yr-Old Lagos Fabric Merchant Alhaja Ajoke Elediye For Drug Trafficking

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Operatives of the National Drug Law Enforcement Agency (NDLEA) began the new year by arresting a wanted drug kingpin and Lagos socialite, 61-year-old Alhaja Aishat Feyisara Ajoke Elediye, on Wednesday, 1st January 2025, in her mansion at the Okota area of Lagos.

This followed the interception of a truckload of illicit drugs from her staff on the same day.

A statement released by the anti-drug agency’s spokesperson, Femi Babafemi, reveals that the suspect, known in the drug underworld as “Iya Ruka” and as Alhaja Ajoke in social circles, had her true identity concealed for years.

She had remained on the NDLEA’s wanted list for leading one of the drug cartels operating from the Mushin area of Lagos.

“The lid was, however, blown off her invincibility on Wednesday, 1st January 2025, when NDLEA operatives, acting on intelligence, intercepted a white Izuzu truck carrying 44 jumbo sacks containing 1,540 kilograms of imported cannabis, driven by one of her staff, 41-year-old Abideen Adio.

Subsequently, the operatives stormed her hideout at 33 Adebayo Oyewole Street, off Ago Palace Way, Okota, where they arrested her.”

Babafemi further stated that, on the surface, Alhaja Ajoke is a businesswoman who imports fabrics and shoes from China, but beneath that lies a vast illicit drug trade.

She is also recognized as the Iyalaje of Blessing Sisters, an influential club of society women in Lagos.

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