The Central Bank of Nigeria (CBN) has paid $1.5bn as settlement for the balance of the valid foreign exchange backlogs the new governor, Olayemi Cardoso, inherited when he assumed office last year.
In total, the CBN settled only $3.8bn out of the $7bn forex backlog claims inherited by the governor, leaving $3.2bn as illegitimate transactions.
The CBN disclosed the payment on Wednesday in a release by the Bank’s Acting Director, Corporate Communications, Mrs. Hakama Sidi Ali, seen by NewsNGR.
Cardoso had revealed in an interview on Arise TV aired on February 5, 2024 that he inherited about $7bn forex backlogs out of which $2.4bn are illegitimate.
Cardoso said that the apex bank has settled $2.3bn of the legitimate backlogs and has an outstanding of $2.3bn.
But the bank only paid $1.5bn out of the balance of $2.3bn which the CBN boss admitted during an exclusive interview with Arise TV.
The remaining $8m may have been further declared invalid, by the auditor, Deloitte Consulting, hired by the apex bank to examine the $7bn claims.
The apex bank said, “CBN recently concluded the payment of $1.5 billion to settle obligations to bank customers, effectively settling the residual balance of the FX backlog.
“The independent auditors from Deloitte Consulting meticulously assessed these transactions, ensuring that only legitimate claims were honoured. Any invalid transactions were promptly referred to the relevant authorities for further scrutiny.”
The CBN believes that clearance of the foreign exchange transactions backlog would stabilise the exchange rate and thereby curb imported inflation as well as spurring confidence in the banking system and the economy.
During the February Monetary Policy Committee meeting and a subsequent conference call with foreign portfolio investors Cardoso told investors to set expectations for sustained increases in Nigeria’s foreign currency reserves and improved liquidity in the foreign exchange market.
According to the CBN, the efforts have led to a significant increase in external reserves, rising by $993m to $34.11bn as of March 7, 2024.
This is the highest growth recorded in eight months.
“The month-on-month increase was driven by a marked advance in remittance payments by Nigerians overseas, as well as higher purchases of local assets, including government debt securities, by foreign investors,” CBN noted.