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Nigeria’s naira hits N540 to a dollar on parallel market, its lowest level

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By Oludare Mayowa

The naira weakened to N540 per dollar on the parallel market on Thursday, its new record low as small businesses and importers search for forex to enable them stock ahead of end of the year sales.

The local currency had closed at N531 to the dollar on the black market on Wednesday due to what traders said was shortage of dollar in the market.

The naira also depreciated against the greenback on the official NAFEX window as the currency traded at N411.67 to the dollar compared with N411.50 it closed the previous day.

Traders said most participants maintained bids between N400.00 and N412.16 per dollar at the Investors and Exporters (I&E) foreign exchange window.

The depreciation of the naira across markets came on the heel of threat by some banks to publish names of forex defaulters in accordiance with the Central Bank of Nigeria (CBN) directive.

In an email to its customers, First Bank Limited on Thursday said it will publish names and BVN of customers who present fraudulent travel credentials or cancel their tickets and fail to refund the purchased PTA and BTA within two weeks.

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The CBN had last week accused some bank customers of obtaining foreign exchange through false documentations and therefore directed banks to publlish the names of such customers found wanting on their website.

In the email sent to customers by First bank tittled; “Notice of publication of Forex defaulters,” the lender said it has been directed by the CBN “to inform all our customers that unethical practices to circumvent the new CBN policy on the sale of forex, such as the presentation of false travel documents, visas, and the cancellation of flight tickets after purchasing personal travel allowance (PTA) and business travel allowance (BTA), will no longer be tolerated.

“Defaulting customers who present fraudulent travel credentials or cancel their tickets and fail to refund the purchased PTA and BTA within two weeks, as stated in the signed customer declaration form, will have their identities and bank verification numbers (BVNs) published.

“We aim to implement this policy immediately as an organisation that is fully compliant with the Central Bank of Nigeria’s rules and regulations.

“Our bank is committed to partnering with the CBN to ensure a transparent, efficient and stable FX Market that meets the needs of all legitimate users.”

The regulatory bank had 44-day ago suspended dollar sales to bureau de change operators in a bid to curb what it call sabotage of its forex policy by BDCs.

However, since then the naira has consistently losing value on the parallel market and has lost 11.34 percent against the dollar since the policy shift.

Analysts blamed the weakening naira to shortage of dollar to meet growing demand in the market.

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