Friday, July 31, 2015

BAD MARKET? Nigerian Banks Reject Deposits of Dollars Into Domiciliary Accounts

Major commercial banks in the country have stopped accepting deposits of Dollar into domiciliary accounts.

Reports say the banks have too much dollars in their vaults and are looking for ways to offload the currency. The banks, reportedly led by Stanbic IBTC, approached the CBN to offload the greenback but the apex bank wasn't interested in buying.

“By the time CBN refused to wire the cash abroad, the banks led by Stanbic IBTC stopped accepting cash from their customers. Stanbic IBTC sent an email two days ago to its customers that it would not accept dollar deposits for the time being and this was followed by ten other banks,” a CBN official said.

According to a BDC operator, the reason the banks have too much cash is due to speculation and money laundering.

"A lot of people have been speculating against the naira and amassed so much cash. Then there are those who have been amassing dollars obtained illicitly and want to launder the money,

“So bank vaults are awash with dollars, largely driven by speculation and money laundering. The banks made it very clear that they want to get rid of the dollars in the system, so if you want to withdraw you can, but you cannot pay in dollars into your domiciliary account,” a BDC operator explained.

He said the situation was compounded by CBN’s insistence that BDCs obtain the Bank Verification Numbers (BVNs) of their customers before transacting any business with them.

The CBN about a fortnight ago also directed the BDCs to provide the BVN of all their directors before August 15, as failure may affect their continued participation in the forex market.


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