The series of recent interventions by the Central Bank of Nigeria appears to be yielding expected result as Nigerian Banks now see improved dollar liquidity.
Speaking on the new development, Head of Treasury at Ecobank Nigeria, Olakunle Ezun, said with improvement in the business environment, especially in the foreign exchange market, many commercial banks now enjoy improved dollar liquidity which prompted them to review spending limit on POS and online deals.
He said: “A lot of banks have improved liquidity. We’re returning to the pre-crisis era, when access to the dollar was not restricted. The CBN has settled a lot of outstanding dollar obligations which affected banks’ positions”.
In a report to customers yesterday, Tuesday, 11th July; titled: Upward Review of the International Spending Limit on Your Naira MasterCard’ GTBank raised monthly dollar spending limit on naira MasterCard from $100 to $1,000 representing 900 per cent increase.
The bank said: “We write to inform you of the monthly spending limits currently applicable when using your GTBank Naira MasterCard for International payments”.
The decision to increase the spending limit followed improved dollar liquidity in the market triggered by the Central Bank of Nigeria (CBN)-sustained interventions. The interventions, however, have yielded results and reduced foreign currency pressure on many lenders.
Confirming the rising dollar liquidity in the economy, Fitch Ratings said Nigerian banks’ ability to access dollar has improved considerably since the CBN introduced a foreign exchange “window” in April aimed at investors and exporters.
It admitted that the Nigerian Autonomous Foreign Exchange Rate Fixing (NAFEX) mechanism, commonly referred to as the “Investors’ and Exporters’ FX Window”, is boosting foreign currency supply and the flow of dollar liquidity into the banking system.
This development, however, is a testimony to our earlier advocacy for a platform that allows the FX to be determined by the market with little guide by the CBN.