The federal government and the Central Bank of Nigeria (CBN) have vehemently denied reports suggesting plans to convert $30 billion domiciliary deposits to Naira, countering allegations that such measures were being considered to address the foreign exchange crisis and prevent the further devaluation of the Naira.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun:
Minister Edun categorically refuted the claims, stating, “There is no iota of truth in the claims of Punch Newspaper that the federal government plans to convert foreign exchange in depositors’ domiciliary accounts to Naira.
“The publication of such falsehood at a time when the government is working to restore economic stability and confidence in the national currency is tantamount to economic sabotage. For the avoidance of doubt, I emphasize that depositors’ foreign currency in their domiciliary accounts will not be converted to Naira.”
The CBN echoed this sentiment through its official communication channels, asserting, “No plans to convert $30bn domiciliary deposits to Naira. This news is fake!”
Mrs. Hakama Sidi-Ali, the acting Director of Corporate Communications at the CBN, dismissed the allegations as false and aimed at causing panic in the foreign exchange market.
She emphasized, “Similar false narratives have been spread on the work of the CBN over the past few months, and it is clear that vested interests are determined to sabotage our efforts.
“We want to assure the general public that CBN is working to build confidence and would never do anything to undermine the currency and the economy.”
Sidi-Ali continued to urge stakeholders to disregard stories intended to incite panic, describing them as “acts of national sabotage.”
She emphasized the CBN’s commitment to stabilizing the foreign exchange market and advised against the peddling of false reports.
Earlier reports had surfaced, suggesting that the federal government was contemplating a policy to convert foreign currencies in domiciliary accounts to Naira in a bid to stabilize the national currency.
The alleged plans involved ordering the conversion of idle foreign currencies in individuals’ and corporate organizations’ domiciliary accounts to Naira at a rate determined by the CBN.
A presidency source was reported to have indicated that the forex scarcity and Naira’s fall were perceived as elite issues. The source emphasized the government’s resolve not to stand by while individuals hoarded foreign currencies, seemingly at the expense of the Naira.
CBN’s Recent Circular:
The CBN had recently released a circular addressing suspected cases of excessive foreign currency speculation and hoarding by Nigerian banks. The circular, titled: “Harmonisation of Reporting Requirements on Foreign Currency Exposures of Banks,” aimed at reducing risks associated with banks holding substantial foreign currency positions.
The CBN expressed concern over the growing trend of banks holding excess foreign currency positions, citing potential risks. The circular required banks to sell off excess dollars in their vaults by February 1, 2024, as part of measures to manage risks and avoid systemic challenges.
