BREAKING NEWS! CBN INSIDE DEALS
CBN recently fined standard chartered Bank two billion for contravening foreign Exchange rules. Our inside sources gathered from insider sources in CBN that recently, ICBC Bank of China wanted to bring some dollars into the Nigerian economy. They contacted Stanbic IBTC, which usually handles their transaction and told them that they wanted to exchange $60 million for Naira at the rate of N390 to $1.
But in view of the fact that the CBN governor had earlier issued a directive to banks to obtain clearance from him be before they carry out any foreign exchange transaction above N315 to $1 or risk sanction, officials of Stanbic IBTC called to obtain clearance to buy the dollars from ICBC.
Emefiele refused the request. Stanbic reverted to ICBC to inform them that they could not get the CBN approval to buy at the rate. In a sudden twist, ICBC informed Stanbic IBTC that they had already sold the $60 to zenith bank at N390 to $1.
The question, therefore arose as to how zenith got information about the deal that was in offer and sealed it at the same rate that the CBN rejected when it was presented by Stanbic IBTC. Our sources, gathered that Emefiele had instructed banks to always post their transactions on Reuters. It is through Reuters that international investors and foreign media see Nigeria daily foreign exchange transactions. But in this case, zenith bank did not post the $60 million transaction on Reuter's system. Could Emefiele be creating a wrong impression that Nigeria's exchange rate is below N315 to $1? when other banks got wind of how zenith bank had done a transaction of N390 to $1. They assumed that the CBN had relaxed its tight control of the forex market. Soon, they began to call their foreign clients to bring in money that could not be brought in because of the artificial low rates introduced by the CBN. It was at this point that Standard chartered bank was said to have entered into trouble with CBN governor. They contacted of their foreign clients to arrange a $25 million transaction at N380 to $1. They quickly brought it and then sold all the $25 million to various Nigerian clients at N380 to $1.By so doing, standard chartered had complied with another forex rule, that banks must not charge more than a spread of 50kobo on forex deals.
But in view of the fact that the CBN governor had earlier issued a directive to banks to obtain clearance from him be before they carry out any foreign exchange transaction above N315 to $1 or risk sanction, officials of Stanbic IBTC called to obtain clearance to buy the dollars from ICBC.
Emefiele refused the request. Stanbic reverted to ICBC to inform them that they could not get the CBN approval to buy at the rate. In a sudden twist, ICBC informed Stanbic IBTC that they had already sold the $60 to zenith bank at N390 to $1.
The question, therefore arose as to how zenith got information about the deal that was in offer and sealed it at the same rate that the CBN rejected when it was presented by Stanbic IBTC. Our sources, gathered that Emefiele had instructed banks to always post their transactions on Reuters. It is through Reuters that international investors and foreign media see Nigeria daily foreign exchange transactions. But in this case, zenith bank did not post the $60 million transaction on Reuter's system. Could Emefiele be creating a wrong impression that Nigeria's exchange rate is below N315 to $1? when other banks got wind of how zenith bank had done a transaction of N390 to $1. They assumed that the CBN had relaxed its tight control of the forex market. Soon, they began to call their foreign clients to bring in money that could not be brought in because of the artificial low rates introduced by the CBN. It was at this point that Standard chartered bank was said to have entered into trouble with CBN governor. They contacted of their foreign clients to arrange a $25 million transaction at N380 to $1. They quickly brought it and then sold all the $25 million to various Nigerian clients at N380 to $1.By so doing, standard chartered had complied with another forex rule, that banks must not charge more than a spread of 50kobo on forex deals.
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