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CBN Clears All Valid FX Backlog

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The Central Bank of Nigeria (CBN), on Wednesday, announced it has cleared the $7 billion foreign exchange (FX) backlog inherited by Governor Yemi Cardoso.
In a statement by CBN’s Acting Director of Corporate Communications, Mrs Hakama Sidi Ali, the apex bank said that independent auditors from Deloitte Consulting meticulously assessed these transactions, ensuring that only legitimate claims were honoured.
“Any invalid transactions were referred to the relevant authorities for further investigation,” she stated.

The statement noted that the CBN recently concluded the payment of $1.5 billion to settle obligations to bank customers, effectively settling the residual balance of the FX backlog.

Cardoso had in a recent meeting stated: “We made clearing the FX backlog a priority to restore credibility and confidence in the Nigerian economy.

He added: “It was important that we go through an independent and credible process that would determine the authenticity of those obligations, and, at this point, I can tell you that we have now cleared all genuine, verifiable transactions. This encumbrance to market confidence in the country’s ability to meet its obligations is now totally behind us.”

The CBN’s commitment to tackling the FX backlog is paying off, with the external reserves witnessing  a significant rise, reaching $34.11 billion as of March 7, 2024, the highest level in eight months.

This month-on-month increase is attributed to a notable rise in remittance payments from Nigerians abroad and increased foreign investment in local assets, including government debt securities.

The clearance of the foreign exchange transactions backlog is part of a broader strategy outlined during the last Monetary Policy Committee (MPC) meeting to stabilise the exchange rate and thereby curb imported inflation, spurring confidence in the banking system and the economy.

 

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