The Central Bank of Nigeria on Friday published updated guidelines for Deposit Money Banks to deposit surplus foreign currency notes at its Lagos and Abuja offices.
This initiative seeks to harmonize exchange rates between parallel and official markets. The official foreign exchange closed at N1,505.30 on Friday, but the black market rate was N1,520.
The CBN approved DMBs’ deposits of excess foreign currency notes with the Central Bank on June 27, 2024.
The approval is in response to the increased demand by DMBs to deposit their currency cash with CBN for onward credit to their offshore accounts with the correspondent banks.
The guidelines specify the processes and constraints for these deposits. DMBs must submit at least three working days’ notice of their intention to deposit foreign money in writing to the CBN Lagos or Abuja Branch Controller. The notification must include the names of the owners of the foreign cash to be deposited.
There are also specific deposit thresholds. The highest daily deposit limit for higher denomination USD bills (USD100 and USD50) is USD10 million, while lesser denomination USD notes (USD20 and below) have a limit of USD1 million. The maximum daily deposit limit for GBP notes is GBP1 million, whereas for EUR notes it is EUR1 million.
Additionally, two representatives from the depositing bank must be present to witness and confirm the amount being deposited. Deposits can include USD notes of various denominations (USD100, USD50, USD20, USD10, USD5, USD1), as well as all GBP and Euro denominations. Each denomination must be packaged in separate boxes.
The naira dropped 1.94% against the dollar in June, closing at N1,505.30 on Friday from N1,476.12 at the start of the month, according to FMDQ data.
This is despite a 54.12% increase in dollar sales to $187.82 million on Friday, up from $121.87 million on June 3, 2024.
The naira fell 2.63 percent in the parallel market when the dollar was quoted at N1,520 to close FX trading for the month, down from N1,480 at the start of the month.
