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CBN Spends $7.98bn, £3m, €16m On Forex Liquidity

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The Central Bank of Nigeria (CBN) last year disbursed $7.98 billion, £3 million and €16.29 million to boost foreign exchange liquidity in the country as the amount it expended on printing new notes rose by 29.31 per cent in 2018 to N64.04 billion. In 2017, it expended N49.52 billion on printing of naira notes, N14.51 billion less than what it spent in 2018. Furthermore, a total of N5.63 billion or 7.96 percent was expended on air charter, compared with N4.02 billion incurred during the corresponding period in 2017.

According to the CBN Currency Operations Department Annual Report released yesterday, the Department, in collaboration with Travelex Nigeria and Innovate 1 Pay Limited, carried out the procurement and distribution of $2.4 billion last year out of which $1.8 billion was supplied to Lagos branch and $600 million to Abuja branch for onward distribution to other banks.The report noted that the forex disbursed was used to fund the operations of Bureaux De Change (BDCs), payment of estacode allowances to Ministries, Departments and Agencies (MDA), pilgrimages and Personal Travel Allowances (PTA), as part of efforts to deepen the foreign exchange market, boost liquidity and achieve convergence in the exchange rates at the parallel and official markets.

Meanwhile, the report revealed that counterfeit notes discovered increased last year as a total of 119,663 pieces of counterfeit notes with a nominal value of N98.82 million was recorded in 2018 indicating an increase of 1.30 percent in volume and an increase of 5.77 percent in value, compared with 118,126 pieces with a nominal value of N93.43 million recorded in 2017. The N500 and N1000 denominations were the most commonly counterfeited banknotes, which accounted for 65.29 percent and 34.49 percent respectively of the total counterfeit notes according to the report, the ratio of counterfeit notes to volume of banknotes in circulation was 18 pieces per million, compared to 16 pieces per million banknotes discovered in 2017.

It noted that the “increasing trend of counterfeiting of higher denomination banknotes underscores the need for more concerted efforts in managing the risk. The Bank would, however, sustain its publicity campaign, collaborative efforts with security agencies and collation of data on counterfeits, to mitigate the incidences of counterfeiting.”

The report alt showed that the sum of N662.21 million was expended on currency disposal and processing activities as at the end of December 2018, compared with N594.62 million incurred in 2017. This showed an increase of N67.59 million or 9.17 per cent.  A total of 59,939 pieces of various denominations of mutilated banknotes valued at N39.24 million was audited, disposed and replaced in 2018, compared with 323,555 pieces valued at N70.74 million in 2017. This indicated a decrease of 81.47 percent in volume and a decrease of 44.53 percent in value.

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