The Central Bank of Nigeria (CBN) has begun the settlement of foreign exchange forwards to banks. The Guardian gathered yesterday at the apex bank that the CBN has indeed started offsetting the outstanding forex forwards.

This is as the Naira improved to N786.02/$ at the official rate, while it also went up to N1012/$ at the parallel market as of yesterday evening.
Confirming the payment yesterday, a firm said: “We have been directed to inform you that the CBN has delivered all outstanding matured forward forex. We thank you for your patience and cooperation and value you for your business and partnership.

“Please speak with your Relationship Manager or your Trade Service Professional for clarification and additional details.”

It was learnt that while the source of the fund used in offsetting the backlog is still shrouded in mystery, foreign airlines are believed to be beneficiaries also.

In his reaction to the situation, Chief Executive Officer of Dairy Hills Limited, Kelvin Emmanuel, said the CBN moving to clear forex forwards especially commercial letters of credit to first correspondent banks and then Nigerian banks with a total of around $2.8 billion means that banks can get clean lines for opening letter of credit to Nigerian corporates that rely on forwards to import goods.

He added: “Supply from the gas forwards signed between the Ministry of Finance incorporated and international banks that are officially external asset managers to the CBN for financialising five-years of dividends from NLNG that the NNPC holds 49 per cent, means that the 45 per cent black market premium divergence we have seen that the official I&E rates will close ranks significantly and come back within fair value.

“This is necessary to keep the price of PMS, diesel, and Jet A1 within reasonable limits and ensure that consumer goods from durable goods import do not continue inflating, especially going into the festive season.”

With this development, he expected the exchange rate to come within N800 levels within the coming week.