Central Bank Governor Mr Godwin Emefiele on Thursday urged banks in the country not to panic following the decision of the Federal Government to move all the accounts of government parastatals into a Treasury Single Account at the central bank. In an interview with Reuters yesterday, the CBN boss gave an assurance that he was ready to inject liquidity if needed into the interbank market.
The policy is part of President Muhammadu Buhari’s drive to fight corruption,
“There is no shortage of liquidity,” Emefiele said, pointing to an oversubscribed sale of treasury bills on Wednesday”. He also said less than one trillion naira ($5 billion) would be moved into the single account but did not give details.
Emefiele was also emphatic about maintaining the naira currency – which has dived in the past year due to a collapse in oil revenues – at its current level of 197 to the dollar.
“There will not be a devaluation of the naira because right now the currency is appropriately priced,” he said. In a series of unconventional interventions to protect the naira, the bank has blocked access to foreign currency to import items ranging from soap and toothpicks to cement and private jets.
Emefiele said the list of restricted items could be expanded to encourage local production even as he rejected claims by Nigerian firms about the difficulties of getting hold of dollars.
Labour counsels banks
Meanwhile, National Union of Banks, Insurance and Financial Institutions Employees, NUBIFIE, has given operators in the nation’s banking industry tips on how to survive challenges posed by the newly introduced Treasury Single Account, TSA by the Federal Government.
The Union President, Danjuma Musa told Vanguard in Lagos that “it is high time the operators in the finance industry put on their thinking caps and devise urgent means of overcoming this federal government challenge to their existence in business. They should also think of a possible means of cutting cost on their excessive expenditures of acquiring expensive vehicles and re-invest such fund; reduce excessive travel abroad for seminars, and board meetings.