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CBN Clears $7 Billion FX Backlog as External Reserves Soar to $34.11 Billion

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The Central Bank of Nigeria (CBN) announced a significant milestone in its efforts to stabilize the country’s economy as it declared the clearance of all valid foreign exchange backlogs amounting to $7 billion.

Acting Director of Corporate Communications, Mrs Hakama Sidi Ali, revealed this achievement on Wednesday night in Abuja, emphasizing the fulfilment of a key pledge by CBN Governor, Mr Olayemi Cardoso, to address the inherited backlog.

In a meticulous process overseen by independent auditors from Deloitte Consulting, the CBN settled obligations to bank customers totalling $1.5 billion, effectively eliminating the residual balance of the FX backlog.

Mrs Sidi Ali assured that only legitimate claims were honoured, with any invalid transactions promptly referred for further scrutiny.

Governor Cardoso underscored the importance of this accomplishment in restoring credibility and confidence in the Nigerian economy. “We have now cleared all genuine, verifiable transactions,” he declared, emphasizing the significance of this milestone in boosting market confidence.

This clearance of the foreign exchange transactions backlog aligns with the strategies outlined in the recent Monetary Policy Committee meeting, aimed at stabilizing the exchange rate and curbing imported inflation while fostering confidence in the banking system and the economy.

Following this announcement, the CBN reported a substantial increase in external reserves, soaring by $993 million to reach $34.11 billion as of March 7, 2024, marking the highest level in eight months.

The surge in reserves was attributed to a surge in remittance payments by Nigerians overseas and increased purchases of local assets, including government debt securities, by foreign investors.

The news signals a positive trajectory for Nigeria’s economic outlook, with expectations set for sustained increases in foreign currency reserves and improved liquidity in the foreign exchange market.

This Article is Fact-Checked. See Policy.
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